Oil Prices Fall as Lower Supply Threats Follow Eased Middle East Tensions

Oil Prices Drop as Middle East Tensions Subside

Oil prices retreated following a reduction in geopolitical tensions in the Middle East, easing immediate concerns about supply disruptions.

Brent crude slipped closer to $67 per barrel after a nearly 4% decline the previous week, while West Texas Intermediate hovered near $63. Diplomatic discussions between Iran and the United States took place in Oman on Friday, aiming to ease disputes over Iran’s nuclear activities. Tehran described the meeting as “a step forward.”

With the US increasing its military presence in the area, President Donald Trump announced plans for another round of talks early in the week. He is also scheduled to meet with Israeli Prime Minister Benjamin Netanyahu and is preparing to introduce tariffs targeting nations that continue trade with Iran.

Despite ongoing worries about oversupply, crude prices have generally climbed since the beginning of 2026, buoyed by geopolitical uncertainty and interruptions in supply, such as those from Kazakhstan. However, last week’s progress in US-Iran relations led traders to anticipate a lower risk of imminent military conflict, causing oil prices to fall.

Attention has also turned to oil shipments to India. President Trump stated that India had agreed to stop importing Russian crude as part of a trade agreement, though Indian officials have yet to confirm this publicly, stressing that maintaining energy security remains their primary objective.

©2026 Bloomberg L.P.