Brent Crude Drops 1.3% After Trump's Iran Diplomacy Remarks

Global oil prices declined on Friday after US President Donald Trump signalled progress in diplomatic discussions with Iran, easing immediate concerns about further disruptions to Middle Eastern crude supplies.

Brent crude futures dropped 1.3% to $103 per barrel, while US West Texas Intermediate (WTI) futures fell 1.16% to $90.43.

Despite the decline, prices remained elevated amid geopolitical uncertainty, attacks on oil shipments and production disruptions in the Gulf of Mexico.

Brent was also heading towards a weekly gain following Thursday's rally of more than 4%.

Trump's Iran diplomacy remarks ease oil supply fears

Oil markets reacted after Trump said Washington was holding productive discussions with Tehran and would not attack Iran before the Nov 3 US midterm elections.

His remarks followed reports suggesting that the United States was considering military action ahead of the polls.

The comments reduced immediate fears of escalation, although uncertainty surrounding the conflict persisted.

Iran's Tasnim news agency reported that Foreign Minister Abbas Araqchi had said Tehran was reviewing Washington's response to an Iranian proposal.

The proposal could allow the Strait of Hormuz to reopen within seven days, potentially restoring shipping through the strategically important waterway.

Any diplomatic breakthrough could ease pressure on international crude supplies and reduce the geopolitical risk premium affecting prices.

Hormuz disruptions, US sanctions keep markets volatile

The eight-month conflict has disrupted energy markets, with traders monitoring developments affecting oil transportation across the Middle East.

Before hostilities began, the Strait of Hormuz carried shipments equivalent to approximately 20% of global oil and fuel supplies.

Attacks on crude-carrying vessels during October intensified concerns about the security of shipping routes through the Gulf.

Meanwhile, Washington announced additional sanctions against individuals, networks and 17 vessels allegedly involved in transporting Iranian crude, petroleum products and petrochemicals.

The measures added pressure on Tehran while creating further uncertainty over regional oil exports.

Energy traders are now weighing the possibility of diplomatic progress against continuing shipping disruptions, sanctions and the threat of renewed military escalation.

The balance between these developments is expected to remain an important influence on crude prices.