Oil Prices Could Fall To $40 After Iran Conflict Ends: US Treasury Secretary Scott Bessent
US Treasury Secretary Scott Bessent has predicted a steep decline in oil prices once the Iran conflict comes to an end, saying increased global supply could push crude prices down to as low as $40 a barrel, Bloomberg reported. Speaking in an interview, Bessent said the oil market could face a supply surplus after the conflict, with additional production capacity expected to come online. He…
US Treasury Secretary Scott Bessent anticipates a significant drop in oil prices following the conclusion of the Iran conflict, estimating crude prices to potentially plummet to as low as $40 per barrel, according to Bloomberg. In an interview, Bessent highlighted the potential surplus in global oil supply post-conflict, which could drive down prices.
He projected a range of $50-$40 for Brent Crude while noting that the timeline for hostilities' cessation remained uncertain. Currently, Brent crude is trading above $95 per barrel, prompting concerns over inflation and pushing global bond yields upward. Bessent emphasized the strong link between oil prices and interest rates, suggesting that a reduction in energy costs could alleviate inflation pressures and lower borrowing costs.
The surge in crude prices has fueled investor worries, driving the yield on 10-year US Treasury bonds to its highest level since 2023. Bessent downplayed fears surrounding Norway's sovereign wealth fund potentially reducing its $75 billion investment in US Treasuries, stating that the move may not signify diminished confidence in US government debt.
Instead, the fund might be seeking higher returns through alternative US-backed securities, such as bonds issued by Fannie Mae, Freddie Mac, and Ginnie Mae, which offer higher yields than conventional Treasury bonds.
Written by urgent.news from Free Press Journal's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
