Oil Prices Plummet as Qatar and US Signal Progress in Iran Talks

Oil prices plummeted by as much as 5% to a three-week low on Tuesday after Qatar and US Treasury Secretary Scott Bessent signaled progress toward a diplomatic agreement with Iran that could reopen the Strait of Hormuz and ease concerns over global oil supplies.

According to Reuters, Brent crude futures fell $3.95, or 4.72%, to $79.82 a barrel by 1340 GMT after hitting a session high of $86.33. U.S. West Texas Intermediate (WTI) crude was down $4.32, or 5.38%, at $76.02 a barrel.

Qatari officials said that a potential US-Iran resolution has been drafted, while US Treasury Secretary Bessent stated that a deal with Iran to reopen the Strait of Hormuz could come as soon as Tuesday or Wednesday.

Giovanni Staunovo, an analyst at UBS, noted that oil prices are pairing earlier gains on comments from Qatari officials. He also mentioned that while production in the Middle East has recovered from lows, it remains below pre-conflict levels, keeping the oil market undersupplied.