Brent Crude Drops $16 in Eight Days as Trump, Iran Open Fresh Peace Talks
By Aboki Forex —
Brent crude has lost more than $16 per barrel in eight trading sessions, erasing most of the rally triggered by the latest Middle East conflict as the United States and Iran signal a move toward diplomacy. WTI crude opened Monday down 5.24% at $80.23, while Brent fell to $83.86, extending a selloff that has reversed the late-July surge.
Brent traded at $100.30 per barrel on July 23, and WTI hit $91.70, their highest levels since May, after renewed US-Iran military strikes raised fears of supply disruptions through the Strait of Hormuz. Now, with talks set to begin, markets are pricing in a lower risk of prolonged disruption to the waterway that carries roughly a fifth of global oil trade.
Trump prioritises negotiations
US President Donald Trump told reporters aboard Air Force One on Sunday that new talks with Iran would start Monday afternoon, after he called off a planned military strike he described as potentially the largest US attack since World War II. “We’re just going to see whether or not we can make a deal,” Trump said, adding that he was not seeking further bloodshed and that diplomacy offered a better path.
Trump said Saudi Crown Prince Mohammed bin Salman urged him over the weekend to continue negotiations rather than proceed with strikes. Regional allies feared a broader conflict could destabilise the Middle East, trigger humanitarian fallout and create wider economic disruptions.
Iranian Foreign Minister Abbas Araghchi said Sunday that negotiations involving Iran and Oman were in the final stages. Officials said discussions focused on maritime arrangements, but did not confirm whether they would directly determine the reopening of the Strait of Hormuz.
Markets reverse sharply
The latest selloff follows an earlier decline on July 27, when Brent dropped as much as 5% after the US and Iran paused attacks the previous weekend. On that day, Brent futures fell $4.89, or 5.05%, to $91.89 per barrel, while WTI declined $4.67, or 5.23%, to $84.64. Brent briefly fell below the key $90 support level.
The correction came only days after markets had surged toward $100 per barrel on fears that any sustained closure or restriction of traffic through the Strait of Hormuz could remove substantial crude volumes from global markets and tighten supply.
What it means for Nigeria
Despite the pullback, crude prices remain well above Nigeria’s 2026 budget benchmark of $64.85 per barrel, which could support government revenues if prices hold. But the earlier conflict-driven spike has already hit Nigerian consumers. Before hostilities, petrol sold for roughly N770 to N800 per litre in many filling stations. Prices have since climbed to as much as N1,300 per litre in some locations, pushing up transport costs and adding to inflationary pressure.
Oil prices could fall further if OPEC+ follows through on its approved 188,000 barrels per day output increase for September, the fourth straight monthly hike, and if US-Iran diplomacy gains traction. For Nigeria, softer crude prices would ease fuel costs but also trim dollar earnings from oil exports.