Oil prices drop 7% as Iran talks raise hopes of ending war

Oil prices fell sharply on Monday, with Brent crude dropping nearly 7% to $105.65 a barrel, on optimism that ongoing talks may end the US-Israeli war with Iran. The decline comes as negotiations between Iranian and Qatari officials entered their third day. Brent remains well above the $60-$70 range seen before hostilities began eight months ago, with prices elevated since Iran blocked the Strait of Hormuz, a key waterway for a fifth of global oil and LNG. Shipments have partially resumed but remain disrupted, and President Trump has reportedly resisted Israeli calls for further strikes to let talks proceed. Analysts view the sell-off as potentially overdone, citing uncertainty over Washington's response after Tuesday's midterm elections and risks of re-escalation. Goldman Sachs raised its December Brent forecast to $105, while ING noted markets remain nervous, with refined product exports still low and diesel and jet fuel prices set to stay high.