Crude oil prices fell sharply on Monday as the United States announced a 60-day waiver on sanctions against Iran, following the first round of peace talks in Switzerland.
The diplomatic breakthrough has significantly reduced market fears of a sudden supply disruption in the Persian Gulf, leading to a rapid repricing of risk premiums in energy markets.
The waiver, effective from Monday, allows for the continued export of Iranian oil and petrochemicals while a direct communications line has been established to ensure safe passage through the Strait of Hormuz.
This development marks a tangible de-escalation in tensions that had previously weighed heavily on global energy supply chains.
Traders reacted swiftly to the news, with Brent crude and WTI both sliding as the immediate threat of a geopolitical supply shock receded.
The market move reflects a shift in sentiment from risk-off positioning to a more normalized outlook, at least for the near term.