WTI, Brent fall as Trump signals Iran talks despite Tehran denial

Oil prices fell more than 5 percent on Wednesday after U.S. President Donald Trump said Washington and Tehran were “currently in negotiations” and indicated Iran was willing to reach a peace deal, although Iran rejected any direct talks with the United States.

International benchmark Brent crude futures fell nearly 6% to $98.31 per barrel, while US West Texas Intermediate futures fell 5% to $87.65 per barrel.

Speaking in the Oval Office, Trump said he was withdrawing his threat to attack Iran’s energy infrastructure “based on the fact that we have negotiated.”

“They’re talking to us and they’re talking sense,” Trump said when asked to elaborate on the exchange.

Later Tuesday, The New York Times reported, citing two unnamed officials, that the United States had sent Iran a 15-point proposal aimed at ending the war.

According to the report, it remains unclear how widely the offer, transmitted through Pakistan, was distributed among Iranian officials. It is unclear whether Israel, which has launched attacks on Iran as well as the United States, will support this plan.

Underlining the unusually high uncertainty facing markets, Daan Struyven, co-head of global commodities research at Goldman Sachs, said in a call with the media that the current disruption in oil supply marks the largest shock in decades when measured as a share of global supply.

The bank noted that short-term price movements are driven by changes in the perceived likelihood of worst-case scenarios rather than changes in the base case outlook. Crude oil is effectively trading at a geopolitical risk premium as investors hedge against prolonged disruptions and critically low inventories, Goldman said.

The bank’s base case assumes that flows in the Strait of Hormuz will return to normal within a four-week period in April.