(Corrects paragraph 2 to say prices fell, not rose)
June 12 (Reuters) - Oil prices fell on Friday, extending losses from the previous session after U.S. President Donald Trump canceled plans to strike Iran, reducing fears of an escalation of hostilities following tit-for-tat attacks earlier in the week.
Brent futures fell $1.21 or 1.3% to $89.17 a barrel at 0042 GMT, while U.S. West Texas Intermediate (WTI) crude was $1.23, or 1.4%, lower at $86.48. On a weekly basis, Brent was 4.2% lower, while WTI was down
4.4%.
Trump, who had threatened to hit Iran "very hard," called off planned strikes on Thursday, saying discussions with Iran had progressed. Iran's semi-official Fars news agency reported that Tehran had not approved the text of any agreement.
"While this could, of course, be yet another false dawn, the market's reaction has been both swift and decisive," said IG market analyst Tony Sycamore.
On Wednesday, Iran announced the closure of the Strait of Hormuz, saying any vessel attempting to pass through would come under fire. Tehran's months-long blockade of the strait, which normally carries a fifth of global oil and liquefied natural gas shipments, has kept oil prices elevated.
The U.S. military said on social media commercial ships continued to transit the waterway.
Even as oil prices correct downwards, "as long as the price can hold above support in the low $80s, the risks remain firmly skewed to the upside," IG's Sycamore said.
(Reporting by Sudarshan Varadhan; Editing by Sonali Paul)
