Oil Prices Decline After Tehran Confirms Its Intent to Hold Negotiations with Washington

SadaNews - Oil prices have fallen for the first time in three days after Iran confirmed that it will hold negotiations with the United States, easing the immediate risks of military strikes against the OPEC member oil producer.

Brent crude slid toward $68 a barrel, after rising 4.8% in the previous two sessions, while West Texas Intermediate crude traded below $64 a barrel.

Iranian Foreign Minister Abbas Araqchi confirmed in a social media post that the negotiations will take place in Oman on Friday, clarifying the meeting's location.

Warren Patterson, head of commodity strategy at ING Group in Singapore, stated: "Despite some ongoing hostile rhetoric, the market seems focused on the scheduled talks on Friday between Iran and the United States, and the potential for the diplomatic path to take its course."

He added: "But it is clear, as reflected in recent price movements, that there is a significant amount of uncertainty about how this path will end."

Diverging Positions on Negotiation Standards

The divergence of positions regarding negotiation standards between Washington and Tehran means it remains unclear whether the two sides are realistically capable of bridging significant gaps at a time when tensions are escalating in the region, which supplies about a third of the world's crude oil.

This has reintroduced a risk premium into oil prices, which have recovered this year after declining in the second half of 2025 with signs of a potential global supply surplus appearing.

Record Discounts on Russian Oil Test India's Position on Washington Deal

Traders also monitored peace talks concerning Ukraine this week, which would be affected by Russia's attacks on the energy infrastructure in Ukraine, according to Ukrainian President Volodymyr Zelensky. Zelensky has requested more weapons from his U.S. counterpart Donald Trump to compel Moscow to end the war.

In another context, data from the U.S. Energy Information Administration released on Wednesday showed that U.S. crude inventories dropped to their lowest level in a month, though the decline was less than previous expectations which indicated a larger drop.

As of 2:20 PM Singapore time, Brent crude futures for April settled down 2% at $68.05 a barrel, while West Texas Intermediate crude contracts for March fell 2.1% to $63.75 a barrel.