Oil Drops More Than 7% as Trump Says Iran Talks to Resume

Oil prices fell more than 7% on hopes the US and Iran will resume negotiations.

Bloomberg reported on August 2 that crude slumped after President Donald Trump said new talks with Iran were set to begin later that day. Brent crude for October delivery fell as much as 7.3% intraday to $81.55 a barrel. West Texas Intermediate for September delivery dropped 5.6% to $79.94 a barrel.

Brent had climbed about 25% in July as geopolitical tensions in the Middle East escalated, posting its biggest monthly gain since March.

It remains unclear, however, whether oil shipments in the Middle East will return to normal. About 20% of global oil and liquefied natural gas shipments pass through the Strait of Hormuz in normal times. Last week, a vessel carrying Qatari LNG was hit by a projectile while transiting the waterway.

Iranian Foreign Minister Abbas Araghchi wrote on Telegram that talks with Oman had entered their final stage. Foreign Ministry spokesman Esmail Baghaei, appearing on Iranian state television, said the discussions were focused on a new shipping route through the Strait of Hormuz and that keeping the strait open itself was not under negotiation.

Separately, OPEC+, the group of major oil producers, approved a modest increase in output. The move effectively restores almost all of the production cuts implemented since 2023 and leaves room for further supply increases if the Middle East conflict ends.