The United States has temporarily suspended sanctions on Iranian crude oil production and exports for a two-month period, effective immediately.
The decision follows an announcement by Vice President JD Vance that Iran has agreed to allow UN nuclear inspectors to return to the country, marking a significant de-escalation in tensions that have weighed on global energy markets.
Brent crude prices dropped sharply in the session as traders priced in the prospect of increased supply from the Islamic Republic.
The immediate removal of export restrictions permits Iran to sell and ship petroleum products, directly addressing the supply constraints that had supported higher benchmark prices in recent weeks.
The suspension is tied to the re-entry of international monitors, a condition that Washington views as a critical step toward verifying Iran's nuclear activities.
This development shifts the geopolitical risk premium embedded in energy valuations, offering a temporary reprieve from the supply-side pressures that have characterized the market.