Oil slips more than 1% as talks continue on ending Iran war

Oil prices dropped more than 1% on Monday as discussions continued between Iranian and Qatari officials on ending the US-Israeli war on Iran. Brent crude futures fell by $1.59, or 1.40%, to $111.84 a barrel, while US West Texas Intermediate crude was down $1.56, or 1.50%, to $102.56 a barrel. Brent crude ended October at its highest level in six months due to fears of a possible escalation in the US-Iran conflict following the US midterm elections.

Tim Waterer, chief market analyst at KCM Trade, noted that oil is experiencing a technical pullback following last week's significant gains. The market, however, remains vigilant and ready for the possibility of rhetoric around Iran spiking and driving Brent towards $120 after the midterm elections. Iranian Foreign Minister Abbas Araqchi stated that the ongoing talks aim to continue consultations with Qatari mediators, with Tehran prepared for both defense and diplomacy.

The discussions come amid attacks on oil tankers in the Strait of Hormuz, which are increasing global energy and shipping costs. In October, Saudi Arabia increased crude exports despite attacks by the Iran-aligned Yemeni Houthis on its energy infrastructure. The Organization of the Petroleum Exporting Countries and allies, or OPEC+, kept December production targets steady on Sunday, indicating that further policy adjustments are unlikely until next year as they continue to grapple with export disruptions from the Iran war.