Oil prices fell sharply as diplomatic signals emerge from Washington. U.S. crude futures dropped 2.74% to $96.37 per barrel, while Brent crude declined 1.03% to $98.34, as Vice President JD Vance indicated peace talks with Iran could resume this week. The International Energy Agency forecasts global oil demand will contract by 80,000 barrels daily this year, marking the steepest decline since the Covid-19 pandemic. The Middle East conflict has already caused the greatest disruption to oil supply in history. While the U.S. commenced a blockade of Iranian ports on Monday, potential negotiations offer some relief to markets bracing for sustained supply constraints and demand destruction across Asia and the Middle East.
