Oil prices fall as US and Iran pause strikes, easing market pressure

Oil prices dropped on Monday after the United States and Iran announced a pause in their recent strikes, creating what officials described as "space" for diplomatic talks. Brent crude fell to under $90 a barrel and U.S. West Texas Intermediate settled around $83, roughly a 7% decline from the previous week. The easing of tension helped lift global equity markets, with U.S. Nasdaq 100 futures up 1.4% and S&P 500 futures rising 1%.

U.S. Ambassador to the United Nations Mike Waltz told NBC News that the cease-fire was a response to ongoing negotiations, adding that talks were "ongoing" but that Iran faced "internal fighting." He also rejected claims that U.S. weapons stockpiles were depleted. Iranian Foreign Ministry spokesman Esmaeil Baghaei said Tehran had no direct negotiations with the United States and would not allow America to set the timing of war or peace, while maintaining that the Strait of Hormuz remained closed.

Shipping data showed a sharp drop in vessel transits through the Strait of Hormuz over the weekend, with only 29 verified passages from Friday to Sunday, compared with more stable traffic through the Bab el-Mandeb strait. Analysts noted that while the pause in hostilities offered short-term market relief, sustained lower oil prices would depend on a lasting reduction in conflict-driven supply disruptions.

Jordan reported downing two drones, and Saudi Arabia said it intercepted drones launched by Iran-backed militants in Iraq. Israeli Prime Minister Benjamin Netanyahu travelled to Washington for a meeting with President Donald Trump and to attend the funeral of the late Senator Lindsey Graham. In a separate development, Iran accused Ukraine of attacking an Iranian commercial vessel in the Caspian Sea, prompting Tehran to summon Ukraine’s chargé d’affaires.