Oil Prices Plummet as Iran Conflict Tension Eases

Oil prices plummeted over 4% to two-week lows on Monday as optimism grew that the US and Iran were making progress in resolving their conflict. The Strait of Hormuz, a critical chokepoint for global oil shipments, remains restricted, with analysts predicting it will take months for normal flows to resume.

Despite the continued tension, President Donald Trump said Washington and Iran had 'largely negotiated' an understanding on a peace deal that would reopen the strait. However, the two sides remain at odds over key issues, including blockades.

Two liquefied natural gas tankers were exiting the Strait on Monday, heading to Pakistan and China, while a supertanker with Iraqi crude left the Gulf for China on Saturday after being stranded for nearly three months.

The market reacted cautiously to the developments, with oil prices falling $4.44 (4.3%) to $99.10 a barrel for Brent crude futures and $92.24 a barrel for US West Texas Intermediate futures.