Hormuz Diplomacy Triggers Oil Price Plunge
Oil prices have plummeted in two sessions as diplomatic efforts to normalize shipping through the Strait of Hormuz gain momentum. Brent crude fell by about 2.6% to $86.28 a barrel, while US West Texas Intermediate dropped 2.5% to $80.29 by late Asian trading.
The talks between Iran and Oman are focused on establishing an interim framework that would temporarily allow vessels to pass through the strait while work continues on a more permanent arrangement.
Iran has not agreed to an unconditional reopening of the strait, but is discussing mine clearance, navigation management, and information sharing with Oman.
Oil traders have shifted into a cautious wait-and-see stance as diplomatic activity increases, according to Deutsche Bank strategist Peter Sidorov.