Oil Falls to Two-Week Low on Hope of Breakthrough in Iran War
Seven Lights
The oil price fell to its lowest level in more than two weeks on Monday as fresh hopes of a breakthrough toward ending the Iran war eased the supply premium that has hung over the market. Brent crude, the international benchmark, dropped more than six per cent to $105.55 a barrel.
Investors were cheered by reports that Iran’s supreme leader, Mojtaba Khamenei, had granted “powers” to his government in its talks with Washington seeking to end the Middle East war. Iranian President Masoud Pezeshkian confirmed the grant of “certain authorities” to conduct negotiations, and foreign ministry spokesperson Esmail Baghaei said Iran had a plan to reopen the Strait of Hormuz within two days if talks progressed, calling it a demonstration of Iran’s “good-faith approach”.
Mr Trump, speaking on Monday, said he was in “no rush” to decide whether to resume attacks on Iran. He said there was “less urgency” from Iranian leadership than he had expected, “but they want to make deal more than they ever wanted”. The president has alternately threatened to “give them the hammer” and signalled willingness to negotiate as mediators press both sides.
The White House is divided into three camps pushing different paths to end the war, the International Business Times reported: Vice-President J. D. Vance and envoy Steve Witkoff favour negotiations, defence secretary Pete Hegseth supports renewed hostilities, and treasury secretary Scott Bessent and secretary of state Marco Rubio back continued economic pressure.
Equity markets responded to the diplomatic signals. Shares in British Airways’ parent company, IAG, rose 4.2 per cent in London, while United Airlines jumped seven per cent in New York on the prospect of cheaper fuel. Gold futures opened the week and the month higher even as oil fell, the Wall Street Journal reported, with expectations of tighter US monetary policy weighing on the bullion market.
The strait remains closed to most traffic in the eight-month war, and traders cautioned that a durable settlement, not merely a negotiating mandate, would be needed to normalise flows. Brent had been supported through October by repeated threats of escalation around the waterway.