Global oil prices fell sharply on Monday after diplomatic progress between the United States and Iran reduced fears of a supply shock from the Middle East.
Brent crude dropped 1.2% to $67.21 a barrel, while U.S. West Texas Intermediate fell 1.3% to $62.73 in early trading.
The decline followed talks held in Oman last Friday, where Washington and Tehran agreed to continue indirect negotiations over Iran’s nuclear programme.
Market analysts said the discussions lowered the immediate risk of conflict that could disrupt oil flows through the Strait of Hormuz, a key route for about one-fifth of global consumption.
However, Iranian officials warned that U.S. bases in the region could be targeted if Iran were attacked, keeping geopolitical risks elevated.
Oil markets were also pressured by Western moves to tighten sanctions on Russia’s energy exports over the war in Ukraine.
The European Commission proposed a sweeping ban on services supporting Russia’s seaborne crude trade, adding to uncertainty over global supply.
Indian refiners, once major buyers of Russian oil, are reportedly avoiding April shipments as they pivot towards trade negotiations with Washington.
Analysts said prices will remain volatile as traders weigh shifting supply routes, diplomatic tensions and the pace of alternative crude flows.