Oil prices fell sharply Monday after President Donald Trump said new U.S. attacks on Iran were highly unlikely while talks progress. Trump is due to meet Qatar’s prime minister at the White House; a diplomatic source told Israel Hayom he is bringing an Iranian proposal to reopen the Strait of Hormuz.
Brent crude was down $3.49, or 3.6%, at $94.83 a barrel at 12:19 GMT, and U.S. West Texas Intermediate had lost $2.66, or 2.9%, to $88.17, Reuters reported. Brent later traded near $94. It fell 16% last week and touched a two-month low of $93.22, according to Reuters.
Oilprice.com, citing two diplomatic sources quoted in Israeli media, reported that Qatari-brokered terms would have Iran reopen the strait and halt attacks on Gulf tankers, while the U.S. would end its blockade and unfreeze $8 billion of Iranian money held in Qatar. Neither government has confirmed those terms. Secretary of State Marco Rubio has said a breakthrough is not near, the outlet reported.
Risks to shipping remain. Washington and Tehran both reported vessels hit in or near the strait over the weekend, and Yemen’s Houthis claimed a Sunday attack on Saudi Aramco’s offices in Riyadh, Reuters reported.
JPMorgan estimated in a report Friday that the global oil surplus widened to 1.4 million barrels per day in October from 1.1 million in September.
The next developments to watch are the outcome of the White House meeting, any formal response from Tehran and further attacks on Gulf shipping.
