Brent crude fell to its lowest level since the outbreak of the war in the Middle East on Monday, as traders priced in a potential return of Iranian oil supplies and growing confidence in diplomatic progress.
The decline marks a sharp reversal from the previous week, during which prices had climbed on fears of escalating military conflict.
This move follows a nearly 3% drop in crude prices on Thursday, which had already begun to unwind the gains driven by geopolitical tensions.
Market participants are now weighing assurances from political figures that negotiations are advancing toward an end to the hostilities, reducing the perceived risk of a prolonged supply disruption.
This move follows a nearly 3% drop in crude prices on Thursday, which had already begun to unwind the gains driven by geopolitical tensions.
Reports that former U.S. President Donald Trump signaled hesitancy to resume full-scale military action against Iran further fueled the sell-off, suggesting a de-escalation path is gaining traction among policymakers.
The shift in sentiment highlights how quickly the risk premium embedded in energy markets can evaporate when diplomatic channels appear to open.