Brent crude oil prices fell below US$84 per barrel on Monday as markets reacted to plans by the United States and Iran to resume peace talks, easing concerns that renewed conflict in the Middle East could further disrupt global oil supplies.
Brent, the international benchmark, declined about 5% to US$83.73 per barrel, after rising by more than 20% in July due to heightened tensions between Washington and Tehran.
The drop followed President Donald Trump’s announcement that talks with Iran would resume after he cancelled a planned military strike against the country. Trump said key Middle Eastern allies, including Saudi Arabia, had encouraged negotiations instead of further military action.
The development reduced fears of a wider conflict that could affect oil flows through the Strait of Hormuz, one of the world’s most important energy routes.
Oil prices had climbed sharply last month after renewed hostilities between the US and Iran disrupted the fragile peace arrangement and raised concerns about possible supply shortages. The tension extended from the Strait of Hormuz to the Red Sea, increasing uncertainty in global energy markets.
However, with diplomatic efforts now back on the table, investors have begun to ease some of those concerns, putting pressure on crude prices.
Meanwhile, OPEC+ producers have approved another increase in production quotas as the group continues the gradual restoration of output cuts introduced in 2023. The move is expected to add more supply to the market, although its impact will depend on how the Middle East situation develops.
Despite Monday’s decline, Brent remains significantly higher than a month ago, showing that oil markets are still closely watching developments between the US and Iran.
