Global oil prices fell sharply on Monday as traders reacted to reports that the United States and Iran have reached a deal to ease tensions in the Middle East.
The selloff reflects a market shift in sentiment, with investors rapidly unwinding the geopolitical risk premium that had supported energy benchmarks in recent sessions.
Donald Trump indicated that fresh talks with Iran would begin later in the day, providing a concrete catalyst for the retreat in crude valuations.
The decline in oil comes as global prices retreated on Tuesday as traders weighed reports of renewed mediation efforts between the United States and Iran against a backdrop of fresh military exchanges.
The conflicting signals have created a volatile environment, but the immediate market reaction favored de-escalation narratives.
Brent crude and WTI both posted significant losses, erasing gains accumulated during periods of heightened Strait of Hormuz shipping risk.