Oil Prices Fall as Reported US-Iran Hormuz Deal Emerges

Brent crude fell 3.6% to $94.00 per barrel on Monday as Qatar’s prime minister headed to the White House with an Iranian proposal for an interim deal to reopen the Strait of Hormuz, according to BeInCrypto. West Texas Intermediate dropped 3% to $88.09, while U.S. natural gas rose 0.8% to $3.02 per MMBtu as of 7:26 a.m. ET.

The decline extends last week’s 16% slide in Brent, which marked the benchmark’s steepest weekly fall since the start of the Covid-19 pandemic. According to two diplomatic sources speaking to Israeli media, Iran has signed off on terms where Tehran would reopen Hormuz and halt attacks on Gulf tankers, while Washington would lift its naval and economic blockade of Iran and release $8 billion in Iranian funds frozen in Qatar.

Geopolitical Tensions and Opposition

Under the proposed terms, Iran drops its demand to control the strait and charge transit fees but still refuses to put its nuclear program on the table. Neither government has confirmed the terms. Furthermore, Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, Secretary of State Marco Rubio, and Secretary of War Pete Hegseth reportedly oppose a deal along these lines.

President Donald Trump stated on Sunday that renewed U.S. strikes on Iran are highly unlikely if negotiations produce a strong agreement. Meanwhile, Marco Rubio called Iran’s demands outrageous and ridiculous, stating the two sides are not close to a breakthrough. Iranian Foreign Minister Abbas Araghchi said the offer to reopen Hormuz within two days stands on the condition that the war ends on all fronts.

Market Impacts

Shipping through Hormuz faced continued disruption over the weekend, with Washington and Tehran reporting attacks on vessels in or near the strait, and the Iran-aligned Houthis claiming a strike on Saudi Aramco’s offices in Riyadh on Sunday. Murban crude, the physical Gulf benchmark, climbed 3.4% to $99.17 in Asian trading. A similar U.S.-Iran memorandum reached in Switzerland in May collapsed following an Iranian attack on oil tankers in the strait.

Key facts

• Brent crude fell 3.6% to $94.00 per barrel on Monday.
• WTI dropped 3% to $88.09.
• Qatar’s prime minister traveled to the White House with an Iranian proposal for an interim deal to reopen the Strait of Hormuz.
• The proposed terms involve releasing $8 billion in Iranian funds frozen in Qatar and lifting the U.S. blockade.