Oil drops from near six-month highs on hopes Iran war hostilities to ease

Crude benchmarks retreated on Monday after reaching levels close to six-month highs last week, as diplomatic efforts raised hopes of reduced US-Iran hostilities. By 0426 GMT, WTI stood at $101.04 a barrel, down $2.23 or 2.16%, while Brent was at $114.51, lower by $2.21 or 1.89%.

Business Recorder reported that Brent had gained 6% over the previous week, while WTI rose 2.3%, following attacks in Saudi Arabia that heightened fears about supply. Qatari mediators travelled to Tehran on Sunday, but Houthi claims of strikes on an airport and oil facilities, alongside Saudi reports of intercepted missiles and drones, kept supply concerns alive.

The report noted that disruption to shipping through the Strait of Hormuz and Bab el-Mandeb continues to affect companies. Saudi Aramco plans to begin storing crude in Singapore in the second half of 2027, while the International Energy Agency chief said energy markets are not expected to regain their pre-war position in 2027.