Oil Prices Slide Amid Hopes for Middle East Diplomatic Progress

Oil prices dropped to a one-week low on Monday as hopes for a diplomatic resolution to the Middle East conflict took precedence over renewed attacks on Saudi Arabia and fresh threats between Washington and Tehran.

The Brent crude price fell to $100.5 per barrel, while West Texas Intermediate (WTI) stood at $97.21, as traders factored in the possibility of diplomatic progress at a United Nations meeting this week.

The decline came despite fresh threats exchanged between the US and Iran over the weekend, with the US president warning Iran of economic collapse and regime failure unless Tehran agreed to a deal, while Iran warned that any US attack would trigger a harsh response.

Saudi exports provided some relief as they recovered significantly, with Saudi Arabia exporting about 2.9 million barrels of oil per day through the Strait of Hormuz over the past week, up sharply from around 700,000bpd in August.