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Brent crude dropped below $105 a barrel on Monday for the first time since early October, falling nearly 8% as signs of diplomatic movement between the United States and Iran eased concerns about disruptions to global oil supply.
The international benchmark traded at $104.43 a barrel as of 1700GMT, down 7.94% on the day. West Texas Intermediate, the US benchmark, fell $7.62, or 7.32%, to $96.50 a barrel.
Iran’s state-run IRNA news agency reported that Supreme Leader Mojtaba Khamenei had approved the government’s efforts to negotiate an end to the conflict. The report came as Iranian officials described indirect contacts with Washington.
Foreign Ministry spokesman Esmaeil Baghaei said Deputy Foreign Minister Kazem Gharibabadi had exchanged messages with the United States through Qatari mediators in Doha. Baghaei did not detail the content of those exchanges, according to the information available.
Baghaei said reopening the Strait of Hormuz would require the United States to lift its naval blockade of Iran, setting out a condition that links the waterway’s status directly to Washington’s military posture.
The strait is a narrow passage between Iran and the Arabian Peninsula, and it has long been regarded as one of the world’s most important chokepoints for oil shipments. Any threat to traffic through it has historically weighed heavily on crude prices.
US Secretary of State Marco Rubio said Saturday that President Donald Trump preferred a diplomatic resolution and had yet to decide whether to order fresh strikes on Iran. The remarks left open the possibility of renewed military action even as the diplomatic channel gained attention.
Separately, seven OPEC+ producers agreed Sunday to keep their December oil production targets unchanged. The decision extends a pause in output increases that began in October. OPEC+ is the alliance of the Organization of the Petroleum Exporting Countries and allied producers, including Russia, which coordinates supply policy in an effort to influence global prices.
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