Oil prices fall sharply after US calls off military action and announces negotiations with Iran over nuclear program and Strait of Hormuz.
US President Donald Trump canceled a planned strike on Iran and announced new talks starting Monday, citing pleas from Middle East allies. The decision followed warnings that the attack could have been the largest since World War II, with Trump emphasizing a preference for diplomacy over military action.
West Texas Intermediate crude fell 6.72% to $79.38 amid easing geopolitical tensions. Markets had priced in heightened risks following recent escalations in the region, including attacks on oil infrastructure and threats to shipping lanes. Analysts noted that a potential deal on reopening the Strait of Hormuz could further stabilize supply concerns.
Trump indicated progress toward ending Iran’s nuclear program and suggested a broader agreement may be near. The shift toward negotiations reduces immediate risks of supply disruptions in a key oil transit route, though long-term stability remains uncertain.