Oil prices fall as diplomatic progress between the US and Iran eases immediate strike fears but supply risks persist.
Brent crude prices dropped sharply after the US and Iran paused military strikes, with President Trump indicating a potential deal. The selloff reflects market optimism but remains fragile amid ongoing geopolitical tensions.
Recent history shows similar pauses have been short-lived, and flows through key chokepoints like the Strait of Hormuz and Bab el-Mandeb remain critical. Black Sea exports, including Russian loadings, could further pressure prices if resumed.
Despite the decline, analysts warn that a significant risk premium will likely persist due to the volatility of US-Iran negotiations and broader supply uncertainties.