Oil Prices Crash Over 7% as US-Iran Tensions Ease

Global crude oil prices plummeted over 7% on Monday after the US and Iran paused military strikes, sparking hopes of reduced tensions and a possible diplomatic solution.

The pause in hostilities led to a sharp decline in Brent crude, which dropped more than $7 to trade near $91 per barrel. Similarly, US West Texas Intermediate (WTI) crude fell over 7%, losing around $6.4 to trade below $85 per barrel.

The sudden correction was a result of Iran's indication that it would stop further attacks if the US also halted its military operations. This development came as a relief to markets, which had been gripped by fears of supply disruptions due to the conflict in the Middle East.

However, market experts warned that geopolitical risks remain high, and even with the pause in strikes, there is still uncertainty about the future of oil supplies. Attacks on Saudi Aramco facilities have increased concerns about the security of Saudi oil exports, and shipping activity through the Strait of Hormuz has not returned to normal.