Brent oil prices plummeted nearly 9% late Sunday, tumbling from $91.03 to a low of $82.83. The sudden drop followed US President Donald Trump's announcement that negotiations with Iran to reopen the strategic Strait of Hormuz would begin Monday afternoon.
The price later recovered slightly, settling near $84.06 but still reflecting a 7.66% loss for the day. This sharp decline contrasts with last Wednesday’s 9.6% surge triggered by tensions around the same vital shipping lane.
Diplomatic Moves and Market Reactions
Trump’s declaration came just a day after he called off what he described as a massive planned military strike on Iran. According to Trump, Saudi Arabia, the UAE, Qatar, and Iran all requested a delay, signaling a mutual interest in reopening the Hormuz Strait and potentially negotiating a nuclear agreement afterward. Saudi state media confirmed that Crown Prince Mohammed bin Salman urged de-escalation during a recent call with the president.
However, Iran’s official outlets paint a different picture. The Fars news agency outright denied ever requesting a pause, mocking Trump’s statements and suggesting Tehran remains firm on its position.
Markets have been on edge amid such conflicting signals. Each time Trump delays military action, he credits pressure from regional allies rather than his own advisers. Yet he maintains that US forces are ready to strike if needed. The ongoing uncertainty affects global energy markets, consumer fuel prices in the US, and Iran’s fragile economy.
Both sides signed a memorandum of understanding in June, setting a 60-day negotiation window that is rapidly closing. Monday’s talks could extend this deadline, but Tehran’s public stance remains unchanged. The outcome will likely dictate the next major swing in oil prices.
This material is informational and should not be considered financial advice.
