Global oil prices fell more than 3% on Monday as renewed diplomatic efforts raised hopes of ending the US-Israeli war on Iran. Brent crude futures dropped $3.68, or 3.2%, to $109.75 per barrel. Meanwhile, US West Texas Intermediate (WTI) crude declined $3.43, or 3.3%, to $100.69 per barrel.
The decline followed three consecutive days of discussions between Iranian and Qatari officials over a possible agreement to end the conflict.
Qatar Mediates Iran Peace Discussions
Iranian Foreign Minister Abbas Araqchi said the ongoing talks aimed to continue consultations with Qatari mediators.
He described the discussions as progressing and said Tehran remained prepared for both defence and diplomacy.
Market analysts said hopes of diplomatic progress, alongside the absence of major military escalation over the weekend, eased immediate concerns.
However, uncertainty surrounding the conflict continues to influence global energy markets.
Strait of Hormuz Adds to Supply Concerns
Attacks on oil tankers passing through the Strait of Hormuz have increased shipping costs and raised concerns about global energy supplies.
The waterway remains a critical route for international oil shipments. Therefore, any disruption could put further pressure on crude prices.
Saudi Arabia also increased its crude exports in October compared with September, despite attacks on its energy infrastructure by Iran-aligned Houthi forces.
OPEC+ Keeps December Production Targets Unchanged
Meanwhile, the Organisation of the Petroleum Exporting Countries and its allies, known as OPEC+, maintained their December production targets.
The group is expected to consider further policy adjustments next year as export disruptions continue.
Although diplomatic developments have eased some market pressure, traders remain cautious about renewed military escalation. Consequently, oil prices could remain volatile as negotiations and regional security developments unfold.
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