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- Trump gave Iran 48 hours to reopen Strait of Hormuz on Saturday
(Reuters) – Oil prices plunged by more than 13% on Monday after U.S. President Donald Trump said he would postpone any military strikes against Iranian power plants for five days, hours ahead of a deadline that threatened further escalation in the conflict now in its fourth week.
Brent crude futures traded at about $104.1 a barrel, or down 7.2%, at 1130 GMT after sliding as much as 15% to a session low of $96 a barrel. U.S. West Texas Intermediate was down 7.8% at $90.55 after losing 13.5% to a session low of $85.28.
The U.S. president had warned that Iranian power plants would be destroyed if Tehran failed to “fully open” the Strait of Hormuz to all shipping within 48 hours, setting a deadline of around 7:44 p.m. EDT (2344 GMT) on Monday.
His comments sparked threats of retaliation from Iran’s Revolutionary Guards, which said they would attack Israel’s power plants and those supplying U.S. bases across the Gulf region if Trump followed through with his threat to “obliterate” Iran’s power network.
The war has damaged major energy facilities in the Gulf and nearly halted shipping through the Strait of Hormuz, which handles about 20% of global oil and liquefied natural gas flows. Analysts estimated a loss of 7 million to 10 million barrels per day of oil production in the Middle East.
Reporting by Seher Dareen in London, Mohi Narayan in New Delhi and Florence Tan in Singapore Additional reporting by Dmitry Zhdannikov Editing by David Goodman
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