Oil prices continue to fall on hopes of new US-Iran peace talks
Decline in Oil Prices Amid US-Iran Peace Talk Hopes
Global oil prices dipped on Tuesday as renewed optimism over potential US-Iran negotiations tempered worries about ongoing supply disruptions. The benchmark Brent crude fell 3.8% to $95.54 per barrel, while West Texas Intermediate (WTI) dropped 6.1% to $92.85. This decline followed a Monday surge above $100 per barrel, which had briefly lifted prices before reversing, linked to Trump’s decision to block Iranian ports after weekend talks between the two nations stalled.
Trump later indicated that Tehran had reached out to Washington about a possible agreement, stating during a Monday press briefing outside the White House:
“I can tell you we’ve been called by the other side. They’d like to make a deal very badly.”
The White House has not yet confirmed the details of these discussions, though traders saw the remark as a positive signal.
In addition, the New York Times revealed Iran’s proposal to halt uranium enrichment for five years, an offer the US rejected, demanding a 20-year suspension instead. The report, citing sources from both nations, noted that talks in Pakistan had seen proposals exchanged on nuclear activity but left the door open for a second round of face-to-face meetings. “The discussions suggest a path to peace,” said one analyst, though a deal remains uncertain.
Lindsay James, an investment strategist, attributed Tuesday’s price drop to “hope signals” that both parties are committed to resolving tensions. “News of a potential second round of talks has eased market fears, particularly if Iran avoids testing the US blockade by pausing shipments,” she explained. Tracking data also showed some Iranian tankers navigating the Strait of Hormuz earlier in the day, though they later reversed course—a development that could reflect either data errors or broader US military pressure.
Jiajia Yang, a researcher at James Cook University, suggested that Trump’s Monday comments might signal a “possible de-escalation” in the conflict. “Traders might be adjusting prices after Monday’s sharp rebound, but the key factor is whether Iran delays its nuclear program,” she added. The IEA reported March as the worst month for oil supply in history, with a 10.1 million barrel-per-day drop. However, current prices are still higher than the $73 per barrel seen in early February.
IEA executive director Fatih Birol warned that April could worsen the crisis, as no new oil cargoes are being loaded during the month. “The longer the disruption lasts, the more severe the impact will be,” he stated. The agency has already released 400 million barrels from its reserves to stabilize markets and is ready to act again if needed.
Rahman Daiyan, an energy expert at the University of New South Wales, noted that while Iran contributes modestly to global oil supply, tensions could escalate if the US blockade affects Gulf shipments. Some companies, like BP, are anticipating higher prices to drive profitability. BP reported “exceptional” results for the January-March quarter, a sharp contrast to the weak performance in the final three months of 2025.
Asian stock markets rose on Tuesday, reflecting cautious optimism about the situation. Analysts remain watchful, waiting to see if Iran’s next move could stabilize the energy sector or further disrupt it.