Oil prices fall about 1%: Markets react to upcoming US-Iran nuclear talks

According to experts, progress in the negotiation process reduced fears of conflict escalation, while a new tariff increase by US President Donald Trump created uncertainty about global growth and fuel demand.

Brent crude futures fell by 87 cents, or 1.21%, to 70.89 dollars per barrel, while US West Texas Intermediate crude futures were at 65.63 dollars per barrel, which is 85 cents, or 1.28%, lower.

"The tariff news over the weekend has resulted in some risk aversion flows this morning, which can be viewed in the price of gold and US equity futures, and this is weighing on the crude oil price," said IG Markets analyst Tony Sycamore.

Tariff decision offset growing fears of military conflict between the United States and Iran, which last week raised Brent and WTI prices by more than 5%.

It is known that Iran and the United States will hold the third round of nuclear talks on Thursday in Geneva. Iran said it is ready to make concessions regarding its nuclear program in exchange for lifting sanctions and recognition of its right to enrich uranium.

Vandana Hari, founder of oil market analytics company Vanda Insights, said the risk premium for Brent crude is at least 10 dollars per barrel, and that as long as the threat of US strikes hangs over diplomatic efforts and US naval presence serves as a constant reminder, a significant drop in oil prices is hard to imagine.

According to analysts at Goldman Sachs, the global oil market will remain in surplus in 2026, provided there are no supply disruptions.

Recently, global oil prices rose somewhat as talks between the United States and Iran showed no noticeable progress. An increase in demand for energy resources from India has also been recorded.

Imports of Russian oil to India may decrease by about half after the conclusion of the trade agreement with the United States.