The oil price today is sliding, with US West Texas Intermediate (WTI) crude falling below $100 a barrel on Monday after Secretary of State Marco Rubio said President Donald Trump would prefer to end the Iran war peacefully.
WTI crude futures for December delivery were down $6.80, or 6.5%, at $97.32 a barrel at 14:41 GMT, according to Yahoo Finance data, against Friday’s settlement of $104.12.
The contract has traded between $97.12 and $102.75 so far in the session.
Brent crude futures for January delivery fell $7.13, or 6.3%, to $106.30, compared with Friday’s $113.43 settle.
Both benchmarks closed on Friday at their highest levels since the end of April, CNBC reported, so Monday’s drop has wiped out all of last week’s late surge and more.
WTI and Brent crude oil price chart | Source: Yahoo Finance
Why is the oil price down today?
Diplomacy is doing the work. Iranian negotiators have held days of talks with Qatari mediators in Doha, and a draft proposal is being circulated with a follow-up meeting possible, an official briefed on the talks told Reuters on Monday.
Rubio told reporters over the weekend that Trump “hasn’t made a decision” on military action.
“But we would prefer to do it peacefully,” the secretary of state said, in comments reported by CNBC.
Prices fell to their session lows after Iranian President Masoud Pezeshkian said Supreme Leader Ayatollah Mojtaba Khamenei had granted the government “certain authorities” for peace talks, Reuters reported.
Brent touched $105.86 and WTI $97.12 at those lows, according to Reuters.
Foreign Minister Abbas Araghchi said an agreement with the US is possible if Washington “demonstrates goodwill”, state news agency IRNA reported, adding that Tehran wants sanctions lifted and the US blockade removed.
WTI below $100: how big is the move?
WTI first slipped under $100 in European trading on Monday, Newsquawk noted, and the sell-off deepened at about 13:30 GMT, Yahoo Finance intraday data show.
It is not the first time the US benchmark has been below that line recently. The December contract settled at $99.90 on October 27, Yahoo Finance data show.
At $97.32, though, WTI is trading at its lowest level since October 21, when the contract settled at $97.15.
If the losses hold into the close, Monday would be the December contract’s biggest one-day percentage fall this year, according to Yahoo Finance daily data.
The gap between Brent and WTI stands at about $9 a barrel.
The move points to how much war-risk premium had built into prices ahead of Tuesday’s US midterm elections, after which traders had feared the conflict could escalate.
“The oil market is still reacting with extreme sensitivity to every headline out of the Middle East,” Giovanni Staunovo, analyst at UBS, told Reuters.
Energy stocks follow crude lower
Oil producers fell with crude after the US open. Exxon Mobil was down 3% at $181.67 and Chevron fell 2.4% to $229.93 at about 14:53 GMT, Yahoo Finance data showed.
The United States Oil Fund (USO), an exchange-traded fund that tracks WTI futures, was down 6.1%.
The wider market took the drop in energy costs in its stride, with the S&P 500 up 0.6% at 7,625.42.
What next for the oil price?
The risks have not disappeared. Attacks on tankers in the Strait of Hormuz and on Saudi energy sites by Yemen’s Houthis have continued in recent weeks.
“Attacks on ships and refineries in the Middle East and on civilians in Ukraine continue, doing little to inspire confidence in the prospects for lasting ceasefires in the foreseeable future,” Tamas Varga, analyst at PVM Oil Associates, told CNBC.
“Nonetheless, hope springs eternal,” Varga added.
The world has drained nearly 1 billion barrels from inventories since the war disrupted shipping through Hormuz, ADNOC chief executive Sultan Al Jaber said, according to Reuters.
For the bullish case on Brent, see our earlier report on Goldman Sachs’ $140 warning .
Next event: US midterm elections, Tuesday November 3; any follow-up round of Qatar-mediated talks; EIA weekly inventory data, Wednesday November 4.
A daily settlement back above $100 would suggest traders doubt a deal, while a signed framework could push WTI further from that line.
Should you buy oil now?
Oil is trading almost tick by tick on headlines from Doha and Washington, so prices could reverse sharply if talks stall.
Traders who want to act on the move can compare fees, spreads and margin terms on our list of the best trading platforms .
New traders should read our guide on how to trade commodities and our report on oil prices surging towards $120 on Friday.
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