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Oil drops 1% as US, Iran pledge to continue talks
| USA | economy

Oil drops 1% as US, Iran pledge to continue talks

#Crude oil #US-Iran relations #Nuclear talks #Sanctions #Energy market #Brent crude #Tehran #Commodities

📌 Key Takeaways

  • Oil prices dropped by 1% following news of continued diplomatic talks between the US and Iran.
  • The potential lifting of sanctions could significantly increase global oil supply from Iranian reserves.
  • Market participants have reduced the geopolitical 'risk premium' previously attached to crude prices.
  • Investors remain cautious as the final outcome of the nuclear negotiations is still uncertain.

📖 Full Retelling

Global oil prices fell by approximately 1% during Monday's trading session as delegations from the United States and Iran signaled a commitment to continuing diplomatic negotiations regarding their nuclear standoff. The price drop occurred across major energy exchanges, including London and New York, following official reports that both nations are seeking a de-escalation of tensions that have long restricted Iranian oil exports. Traders reacted swiftly to the prospect of renewed talks, as a successful diplomatic breakthrough could lead to the lifting of heavy sanctions on Tehran, potentially flooding the global market with millions of barrels of crude oil and easing current supply constraints. The decline in Brent Crude and West Texas Intermediate (WTI) futures reflects a shift in market sentiment from geopolitical risk to supply expansion. For months, the energy sector has factored in a 'risk premium' due to the uncertainty surrounding Iran’s nuclear program and the resulting economic penalties. However, the explicit pledge from both Washington and Tehran to stay at the bargaining table suggests that a military or total diplomatic breakdown is less likely in the immediate future. This development provided traders with the necessary confidence to sell off positions, balancing out previous concerns over Middle Eastern instability. Financial analysts note that while the talks are a positive sign for global supply stability, the path to a finalized agreement remains complex. International observers and energy experts are closely monitoring the specific terms of the proposed negotiations, as any delay or setback in the dialogue could quickly reverse the current downward price trend. Beyond the US-Iran dynamic, the market is also weighing these diplomatic updates against broader economic indicators, such as interest rate decisions and manufacturing data from major oil consumers like China and the Eurozone. For now, the focus remains on the diplomatic corridor, as the potential reintegration of Iranian oil remains one of the most significant variables in the 2024 energy outlook.

🏷️ Themes

Economy, Energy, Geopolitics

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Sanction

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Energy market

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📄 Original Source Content
try{ var _=i o; . if(!_||_&&typeof _==="object"&&_.expiry As Claude disrupts stock market, Anthropic researcher warns ’world is in peril’ Gold, silver prices rise amid U.S.-Iran tensions, blowout January payrolls data Dow halts three-day win streak as blowout jobs data curbs rate cut bets Citi pushes back Fed rate cuts to May after blowout January jobs report (South Africa Philippines Nigeria) Oil settles up more than 1% after US urges caution for vessels near Iran Commodities Published 02/08/2026, 06:19 PM Updated 02/09/2026, 03:54 PM Oil settles up more than 1% after US urges caution for vessels near Iran 1 CVX 1.91% LCO 0.07% CL 0.51% By Shariq Khan NEW YORK, Feb 9 - Oil prices settled more than 1% higher on Monday after the U.S. Department of Transportation issued an advisory to U.S.-flagged vessels to stay as far as possible from Iranian territory while passing through the Strait of Hormuz and Gulf of Oman. Brent crude oil futures settled up 99 cents, or 1.5%, at $69.04 a barrel. U.S. West Texas Intermediate crude rose 81 cents, or 1.3%, to settle at $64.36. The U.S. DOT’s Maritime Administration on Monday noted that vessels going through the Strait of Hormuz and Gulf of Oman have historically faced the risk of being boarded by Iranian forces, including as recently as February 3. The agency advised U.S.-flagged ships to stay close to Oman while eastbound in the Strait of Hormuz. The move renewed concerns that tensions between the U.S. and Iran could lead to oil supply disruptions. About a fifth of the oil consumed globally passes through the Strait of Hormuz between Oman and Iran. "This week’s crude trade, and possibly the rest of this month, will have little to do with oil fundamentals but much to do with injection and rejection of risk premium related to Iran," said oil trading adviser Ritterbusch and Associates. Oil prices had dropped earlier, extending last week’s losses, after the U.S. and Iran pledged to continue indirect talks following what they describ...

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