Oil Plunges on US-Iran Deal; Central Banks, China Data Add Pressure

Brent crude slid toward $75 a barrel this week after the U.S.-Iran interim agreement formally took effect, sending global oil prices to their lowest level since January. The deal, which eased supply-risk premiums that had built since early spring, knocked roughly 6% off benchmark crude in five sessions. WTI settled near $71, down from $77 the previous Friday.

The agreement came after weeks of heightened rhetoric, including Trump's threat of new strikes on Iranian facilities, which had earlier pushed oil above $80. The Iran deal effectively removed the immediate war-risk premium from crude pricing, traders said.

Federal Reserve, European Central Bank and Bank of England signals added a second layer of pressure. All three central banks held rates steady this week, with the Fed's dot plot showing no cuts before September. A higher-for-longer interest rate outlook strengthened the dollar, making dollar-denominated commodities more expensive for non-U.S. buyers and further weighing on oil and metals.

Economic reports from Asia reinforced the demand-side drag. Chinese industrial output growth slowed more than expected in May, according to data released Thursday. Japan's core machinery orders also missed forecasts. The combination of softer Chinese factory activity and a strong dollar pushed crude oil to its lowest close since Jan. 10.