- Oil prices fell over 1% amid eased US-Iran tensions reducing Middle East conflict fears
- Brent crude dropped to $67.16, while US West Texas Intermediate fell to $62.76 per barrel
- Oman-mediated talks on Iran's nuclear program were called a "step forward" by Iranian officials
Oil prices fell more than 1% Monday as diplomatic progress between the United States and Iran eased fears of a Middle East conflict that could disrupt global energy supplies.
Brent crude futures dropped 89 cents, or 1.31%, to $67.16 a barrel. U.S. West Texas Intermediate declined 79 cents, or 1.24%, to $62.76 a barrel.
The retreat follows a round of Oman-mediated talks on Friday aimed at defusing tensions over Tehran's nuclear program. Iranian officials described the session as a “step forward” and a “good start,” helping to strip the geopolitical risk premium from the market.
President Donald Trump, who has amassed military forces in the region, said another meeting is scheduled for early this week. While the administration remains poised to implement new tariffs on countries doing business with Tehran, the shift toward diplomacy reassured traders who had previously bet on a supply crunch.
The market is also closely watching India's shifting energy policy. As part of a recent trade deal with Washington, Trump said New Delhi has agreed to halt crude imports from Russia.
While the commitment would mark a significant shift in global trade flows, the Indian government has yet to provide a direct confirmation. Instead, New Delhi continues to emphasise that "ensuring energy security" remains its top priority.
India, the world's third-largest oil consumer, has relied heavily on discounted Russian barrels over the last several years. A pivot away from Moscow, coupled with potential U.S. sanctions on Iran, could tighten the market despite the recent price cooling.
Traders expect a slew of data this week to clarify global balances, with OPEC, the International Energy Agency, and U.S. forecasters all due to issue updated analyses. Additionally, industry leaders are gathering in London for International Energy Week to discuss supply halts in Kazakhstan and the sustainability of the current price dip.
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