Oil prices tumble as US-Iran diplomatic efforts ease supply fears

Oil prices fell sharply on Monday, November 2, extending their retreat from last week's highs as renewed diplomatic efforts between Washington and Tehran reduced concerns over further disruptions to Middle Eastern crude supplies.

The decline followed reports of progress in talks mediated by Qatar, encouraging traders to unwind positions built during October's rally. However, continuing restrictions on shipping through the Strait of Hormuz limited expectations of a rapid return to normal supply conditions.

Price overview

Brent crude futures fell 3.16% to $109.85 a barrel.

US West Texas Intermediate (WTI) crude futures declined 3.72% to $100.25 a barrel.

Brent fluctuated between $109.60 and $112.41, while WTI traded between $100.21 and $102.72.

US-Iran talks pressure prices

Diplomatic efforts intensified after US Secretary of State Marco Rubio indicated that President Donald Trump preferred a negotiated settlement over further military action.

Reports of a proposed framework for reopening the Strait of Hormuz encouraged selling, although no comprehensive agreement had been announced.

OPEC+ maintains production targets

OPEC+ agreed on Sunday to leave its December production targets unchanged, extending its cautious approach amid uncertainty over regional supplies.

The decision provided some underlying support to crude prices, particularly as shipping disruptions continued to restrict exports from the Persian Gulf.

October rally loses momentum

Oil prices entered November following substantial gains driven by tanker attacks, threats to energy infrastructure and fears of prolonged supply shortages.

The prospect of diplomatic progress has begun to erode that geopolitical premium, prompting profit-taking across energy markets.

Market outlook

Brent faces immediate support near $109.60, with resistance around $112.41. WTI could test the psychologically important $100 level, while resistance stands near $102.72.

Further diplomatic progress could extend the correction, although renewed attacks on shipping routes would threaten another reversal.