Oil Prices Dip as US-Iran Talks Raise Hopes for Conflict Resolution
Oil prices declined by 1% on Tuesday as market sentiment shifted in response to the possibility of diplomatic breakthroughs between the US and Iran. The development comes after Washington paused its strikes, raising hopes for a resolution to the conflict.
The Brent crude futures price dropped $0.78, or 1%, to $88 a barrel, while US West Texas Intermediate crude fell $0.88, or 1.1%, to $82. Both benchmarks had earlier touched their lowest levels in more than a week.
US President Donald Trump stated that the US was engaged in 'good talks' with Iran and that a resolution was possible, but warned that strikes would resume if negotiations broke down.
The conflict continues to pose risks to regional shipping, particularly through the Strait of Hormuz. Afrah al-Zouba, the foreign minister-designate of Yemen's internationally recognised Saudi-backed government, expressed concerns about Houthi fighters seeking to replicate Iran's control over shipping in the area.