Oil eases 4% on 'renewed hopes of a breakthrough in the Iranian stalemate'
Brent crude fell more than 4% on the first trading day of November / Photo: Leka Sergeeva / Shutterstock.com
Oil prices fell sharply on Monday as talks between Iranian and Qatari officials on ending the war in the Middle East raised hopes that supply disruptions in the region could ease, Reuters reports. Brent crude futures dropped 4.5%, falling below the psychologically important $110 mark to trade at $108 per barrel at the time of this writing. U.S. West Texas Intermediate crude was down 4.6% at $99 per barrel.
What is happening in negotiations
Brent ended October at its highest level in six months amid concerns that the U.S.-Iran conflict could escalate again after Tuesday’s U.S. congressional midterm elections, Reuters notes. Despite reports that both Washington and Tehran are preparing for renewed strikes after the vote, Secretary of State Marco Rubio said on Sunday that President Trump prefers not to use military force and would like to end the conflict “diplomatically,” CNBC reports.
Following two days of Qatari-mediated talks in Doha, Iranian authorities also signaled that a deal remains possible if their demands are tangibly implemented, Al Jazeera reports. Iran’s delegation left the talks, but its departure was not due to headwinds in the diplomatic process, an official briefed on the meeting told Reuters.
Iranian Foreign Minister Abbas Araghchi said on Sunday that the purpose of the “ongoing and progressing” talks was to continue consultations with Qatari mediators, adding that Tehran was prepared for “both defense and diplomacy.”
What analysts are saying
“The new month brought with it renewed hopes of a breakthrough in the Iranian stalemate,” said Tamas Varga, an analyst at oil brokerage PVM. “Lingering hopes of some form of diplomatic progress, combined with the absence of any meaningful military escalation over the weekend, have taken some of the immediate heat out of prices for now,” noted KCM Trade analyst Tim Waterer.
Goldman Sachs raised its oil price forecasts for this year and next, citing persistently elevated supply risks. The bank now expects Brent to average $88 per barrel in 2027, up from its previous forecast of $80. It cautioned, however, that prices could jump to $140 if oil production in the Persian Gulf remains 3.5 million barrels per day below its 2025 average, Reuters reports.
