Oil Declines as Traders Parse Signs of Fresh Diplomacy on Iran
Oil prices slipped as traders weighed new diplomatic outreach aimed at averting renewed US military action against Iran. Brent crude fell toward $114 a barrel after climbing more than 1% the prior session, while West Texas Intermediate hovered near $102. Iran’s Foreign Minister Abbas Araghchi said Tehran remained open to diplomacy, and the Wall Street Journal reported that US Vice President JD Vance had contacted Mohsen Rezaei, secretary of Iran’s top security body.
President Donald Trump told Axios that negotiations were under way through mediators but cautioned he could not predict their success, adding: “We need to finish the job — either through a deal or another way.” Rebecca Babin, senior energy trader at CIBC Private Wealth Group, noted that “headlines like this can move prices,” with any sign of official communication prompting profit-taking and trimming the risk premium.
Brent has surged 11% this month to its highest since April, pressuring consumers and complicating central bankers' inflation fight. The Federal Reserve held rates steady this week, though traders expect tightening to resume in December. With midterm elections approaching on Nov. 3, Trump has signaled a possible post-election military campaign, potentially alongside Israel.
In Israel, Benjamin Netanyahu narrowly led opposition leader Gadi Eisenkot, but neither has a clear path to forming a government. Physical markets remain mixed: Saudi exports stay near wartime highs despite infrastructure attacks, while US crude inventories fell 1.9 million barrels to the lowest since July, with gasoline stockpiles in the Midwest hitting record lows.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing