(Bloomberg) — Oil fell for the first time in three days after Iran confirmed it would hold negotiations with the US, easing the immediate risk of military strikes against the OPEC producer.
Brent (BZ=F) dropped toward $68 a barrel, after adding 4.8% over the previous two sessions, while West Texas Intermediate (CL=F) was near $64 a barrel. Iranian Foreign Minister Abbas Araghchi confirmed in a social media post that the negotiations will be held in Oman on Friday, clarifying the location of the encounter.
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Differing positions over the parameters of US-Iran negotiations mean it remains unclear whether the two sides can realistically bridge major differences at a time of heightened tensions in the region, which supplies about a third of the world’s crude. That has reinserted a risk premium into oil prices, which have rebounded this year after slumping in the second half of 2025 on signs of a growing global glut.
“We see that there is indeed a bit of oversupply at the moment, but that I would say is balanced with the significant uncertainty that we are seeing because of the geopolitical challenges,” Wael Sawan, chief executive officer of Shell Plc said in a Bloomberg TV interview. “There is a premium with that uncertainty and volatility.”
The added volatility is bolstering market gauges aside from benchmark futures prices. WTI call options settled at their biggest premium to puts since 2022, a sign of how traders are protecting against price spikes. A major exchange-traded product also saw its biggest inflow since 2020 earlier this week.
WATCH: Oil fell for the first time in three days after Iran confirmed it would hold talks with the US. Onur Ant breaks down the situation.Source: Bloomberg
Traders also looked to Ukraine peace talks this week, which Ukrainian President Volodymyr Zelenskiy said will be impacted by major oil producer Russia’s attacks on his country’s energy infrastructure. He asked his US counterpart, Donald Trump, for more weapons to force Moscow to end the war.
Oil is also under pressure amid a broad selloff in precious metals. Silver tumbled more than 17%, erasing a two-day recovery, while gold fell as much as 3.5% in choppy trading.
—With assistance from Tom Mackenzie, Guy Johnson, Anna Edwards and John Deane.
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