Oil Prices Plunge as Trump Says U.S. Is Close to Iran Deal
Oil prices fell sharply on Friday after President Donald Trump said the United States was nearing an agreement with Iran, raising hopes that months of disruption in Middle East energy markets could soon ease.
Reuters reported that Brent crude, the international benchmark, dropped more than 3% and briefly fell below $87 a barrel at 3:49 p.m. ET, while West Texas Intermediate crude slipped to $84.49 a barrel at the same time, its lowest level in nearly two months. The selloff came after Trump indicated that negotiations with Tehran had advanced significantly and that a framework for a broader agreement could be signed in the coming days. Other parties involved in negotiations have also signaled a deal is close.
Oil prices have whipsawed over the past weeks, largely in line with negotiations related to the war in Iran and the possibility that the Strait of Hormuz, through which about 20% of the world’s energy passes, is reopened.
Speaking this week, Trump said discussions with Iran had reached the highest levels of the Iranian government and claimed that a deal was close enough for him to cancel planned military strikes. He described the negotiations as being in their “final points,” though he added that sanctions and the U.S. naval blockade would remain in place until an agreement is formally completed.
Reuters also reported that a peace treaty between the U.S. and Iran could be signed in Geneva on June 14. U.S. Vice President JD Vance and Iranian Parliament Speaker Mohammed Baqer Qalibaf will likely represent their respective countries.
A successful agreement could allow more oil to reach international markets and ease pressure on inflation. However, uncertainty remains high. Iranian officials have pushed back against Trump’s claims that a final agreement has already been reached. Tehran has repeatedly stated that negotiations are continuing and that no definitive decision has been made on several key issues.
Iranian media and government sources have characterized discussions as ongoing rather than finalized. Trump’s optimism about a possible agreement was tempered by sharp criticism of Tehran’s negotiating tactics.
In a series of comments on Friday, the president accused Iranian officials of leaking inaccurate details about the talks and described them as “very dishonorable people” to negotiate with. Trump insisted that reports circulating in Iranian media about the contents of a potential deal had “nothing to do with the terms that were agreed to” and warned that Tehran needed to “get their act together” if it wanted a final agreement.
Even with the latest drop, oil remains elevated compared with levels before the conflict escalated earlier this year. Market participants are also monitoring global inventories, OPEC production policy, and the pace at which shipping traffic could normalize if a deal is ultimately signed. Reuters reported that concerns about tight supplies could still support prices later this summer if exports fail to recover as quickly as expected.
