Citigroup’s global head of commodities research warned that oil prices will keep swinging until the U.S. and Iran reach a resolution to the ongoing war under President Donald Trump. The volatility stems from uncertainty over diplomatic talks that could reshape supply dynamics. Traders and investors brace for sharp price swings as the market waits for a breakthrough.

The head of research pointed out that market participants currently lack a clear timeline for when the two sides might settle. Without a definitive agreement, price swings could widen further, affecting hedgers and end‑users alike. The uncertainty also strains risk‑management budgets for firms exposed to energy costs.

Because oil pricing feeds into global inflation metrics and corporate earnings forecasts, the prolonged uncertainty could ripple through equity markets and bond yields. Firms that rely heavily on oil for production or transportation may see higher input costs, tightening margins. In short, investors must monitor the U.S.–Iran negotiation window closely.

Analysts suggest that a swift settlement could calm the market, but any delay risks a re‑emergence of supply fears, especially if new sanctions or production cuts surface. Current oil inventories sit near historical highs, yet the lack of a clear policy direction keeps the sector in a state of constant recalibration.