Brent crude oil prices fell to approximately $105 per barrel on Thursday after President Donald Trump said a deal with Iran could emerge "very quickly" [1].
The shift in market sentiment follows growing concerns over an immediate escalation of the conflict in Iran. A rapid diplomatic resolution would stabilize global energy supplies and reduce the risk of a wider regional war.
Global financial markets reacted positively to the prospect of a ceasefire. Wall Street saw an overnight gain of over one percent [1], while Asian markets also trended bullish as investors weighed the likelihood of a diplomatic breakthrough.
Trump has previously indicated that a resolution is within reach. On May 19, he said it is "very possible we will make a deal" [2]. Earlier this month, he said the current state of the ceasefire is on "life support" [3].
Oil prices have shown significant volatility amid these developments. While some reports indicate Brent cooled to $105 per barrel [1], other data suggests a sharper decline of over eight percent, with prices touching $100.5 per barrel [4].
The decline in crude prices reflects a decrease in the "risk premium" that traders typically add to oil when geopolitical tensions threaten production. The prospect of a deal suggests that the immediate threat of supply disruptions may be diminishing.
Trump's remarks during the opening bell on Thursday signaled a shift toward a more optimistic timeline for negotiations [1]. The markets continue to monitor these diplomatic signals to determine if the price drop is a short-term reaction or the start of a longer trend.
“"Very quickly"”
The volatility in Brent crude prices demonstrates how sensitive global energy markets remain to the diplomatic relationship between the U.S. and Iran. By signaling a rapid deal, the administration is effectively lowering the geopolitical risk premium, which provides temporary relief to inflation-wary markets and equity investors. However, the wide range in reported price floors—between $100.5 and $105—indicates that traders are still hedging their bets until a formal agreement is signed.
