US crude oil fell sharply on Monday after Iran’s President Masoud Pezeshkian said Supreme Leader Mojtaba Khamenei had granted the government “certain authorities” to negotiate with the United States. The December WTI contract (CL=F) traded at $96.97 at 10:01 a.m. EST, down $7.15, or 6.87%, from a prior close of about $104.12, according to Yahoo Finance.
The statement came via Iranian state media, and the scope of the authority has not been spelled out. Iran’s Foreign Ministry says the Strait of Hormuz cannot reopen until the US ends its naval blockade and Iran’s demands, including the release of frozen funds and sanctions relief, are met. It called a two-day timeline for reopening the strait a goodwill gesture. The US has not accepted that proposal, and no date or venue for talks has been set. Qatar is mediating.
Reports on the size of the drop differ by source and time. IBTimes put Brent about 6% lower, below $107, while an earlier TradingKey report had Brent down about 2% at $109.48.
The move is a reaction to headlines, not to an agreement. If talks stall, the same headline risk can push prices back up quickly.
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Sources:
- Yahoo Finance: Crude Oil Dec 26 (CL=F)
- investingLive: Oil prices sink as Iran’s President says Supreme Leader granted certain authorities
- IBTimes: Iran authorizes US negotiations, oil prices fall
- TradingKey: WTI pulls back as US and Iran plan talks
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