Oil prices fell sharply on Monday as signs of de‑escalation between the United States and Iran eased fears of a major conflict that had pushed crude to recent highs.
Both Brent crude and US West Texas Intermediate (WTI) futures slid about 4%, retreating from multi‑month peaks amid reduced geopolitical risk and broader market moves.
Prices Retreat From Recent Highs
Brent crude futures dropped about 4.1% to around $66.50 per barrel, while WTI fell similarly to near $62.50 per barrel, according to market data. The fall marked one of the largest single‑session declines in recent weeks.
Previously, oil had climbed to multi‑month highs as markets priced in the threat of military action between Washington and Tehran.
What Triggered the Drop
Prices eased after US President Donald Trump said Iran was “seriously talking” with Washington, indicating a reduction in tensions. Reports also suggested that Iran’s naval forces were not planning live‑fire drills in key shipping lanes, another sign of reduced conflict risk.
Moreover, a stronger US dollar put additional pressure on oil, since dollar‑priced crude becomes more expensive for buyers holding other currencies.
Market Reaction
Analysts said profit‑taking by traders contributed to the fall as oil reversed gains made earlier on geopolitical fears. With diplomatic signals increasing, markets reacted quickly to trim positions that had been held amid conflict risk.
In addition, OPEC+ has reaffirmed plans to keep production unchanged for March, reducing speculative pressures tied to supply cuts.
What Happens Next
While prices have dropped sharply, analysts caution that oil remains sensitive to shifts in global politics and supply dynamics. Any renewed tensions or disruptions to Middle East crude flows could quickly reverse the recent decline.
Overall, today’s drop shows how strongly oil markets respond to geopolitical developments and risk sentiment.
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