Oil Prices Plummet as US-Iran Tensions Ease

Oil prices plummeted by nearly 5% to their lowest level in two weeks on Tuesday, as hopes of de-escalation between the US and Iran fueled market optimism. Brent futures fell $4.27 per barrel to settle at $84.09, while WTI crude dropped $3.35 per barrel to close at $79.26.

The decline marks a 16% drop in oil prices over the past three days, with both Brent and WTI hitting their lowest levels since July 13 and July 16, respectively. Despite the decrease in tensions between the US and Iran, analysts remain cautious about the prospects of a lasting peace agreement.

Iran has rejected Oman's proposal for managing the Strait of Hormuz, which includes collecting voluntary fees from ships using the vital trade route. Instead, Tehran proposed a temporary arrangement where one direction of traffic would pass through Iranian waters, raising concerns about the continued disruption to oil supplies.