Brent crude dropped to a two-month low of $92.57/bbl as diplomatic optimism between the US and Iran eased escalation fears, with prices sliding an additional 1.21% to $91.45/bbl this morning.
Hopes for US–Iran diplomatic progress drove Brent down 5.85% to a two-month low of $92.57/bbl, with a further 1.21% slide to $91.45/bbl this morning. Reduced escalation fears remove the geopolitical risk premium from crude. Continued mediator talks could push prices lower, while the US being 'locked and loaded' remains a downside risk for the bearish case.
Brent crude oil fell 5.85% to a two-month low of $92.57/bbl as diplomatic progress between the US and Iran reduced geopolitical risk premiums. The decline continued this morning with a further 1.21% drop to $91.45/bbl following reports of mediator talks and positive comments from US officials regarding the conflict.
Headlines suggested diplomatic progress between the US and Iran, reducing fears of renewed escalation and pushing Brent down 5.85% to a two-month low of $92.57/bbl.
If talks between the US and Iran via mediators produce an actual deal, further downside is possible; the oil price already slipped another 1.21% to $91.45/bbl this morning. However, the US remains 'locked and loaded' if the situation changes.