US Sanctions on Iran Push Oil Prices Down to One-Week Low

Oil prices fell sharply on Tuesday to a one-week low as investors shrugged off US sanctions on Iran, viewing economic pressure as less of a threat to oil supplies than military escalation.

Brent crude futures dropped by $2.96 or 3.21% to $89.21 per barrel at 0957 GMT, while WTI crude fell by $2.84 or 3.34% to $82.17.

Saxo Bank head of commodity strategy Ole Hansen said the shift from military conflict to economic pressure had reduced some of the oil market's anxiety, adding that the US sanctions announcement was not as forceful as traders had expected.

Iran vowed to retaliate against the sanctions and expressed confidence that major trading partners would resist Washington's pressure campaign, while supply disruption risks remain a concern for the oil market.