Crude Oil Slumps as Diplomatic Pause Fails to Ease Physical Market

WTI Crude Oil prices dropped by almost 9% to around $81.00 on Monday, after a pause in hostilities between the US and Iran led to a fourth de-escalation of the war since spring.

The American president said there was 'plenty of time' for talks and a good chance of a deal, but Tehran's foreign ministry denied any negotiations with Washington were underway.

Fewer than 10 commodity vessels per day cleared the Strait of Hormuz over the weekend, and the Red Sea route remains shut due to Yemen's Houthi rebels attacking Saudi targets.

The physical market did not participate in the pause, with no supply constraints moving on Monday, and WTI Oil is now trading below its 50-day moving average for the first time since mid-July.