US-Iran Sanctions Threaten Oil Supplies from the Middle East

Oil prices declined on Monday as investors took profits before the expected announcement of new US sanctions against Iran, which could disrupt oil supplies from the Middle East.

Brent crude futures fell $1.23, or 1.3%, to $93.16 by 0829 PKT, while West Texas Intermediate (WTI) crude dropped $1.36, or 1.6%, to $85.7 a barrel.

The US Treasury Secretary, Scott Bessent, is set to hold a press conference on Monday at 2pm EDT (1800 GMT), where he threatened to impose 'the toughest sanctions in history' on Iran.

According to Vivek Dhar, a commodities analyst at Commonwealth Bank of Australia, it's unclear whether US policy will economically isolate Iran effectively. However, if the measures work as intended, Iran's ability to respond with increased violence becomes a growing risk for energy markets.