Oil Falls More Than 4 Percent as Hopes for Iran Talks Ease Supply Fears

Oil prices fell more than 4 percent on Monday, Nov. 2, as hopes for a diplomatic end to the conflict between the United States and Iran eased concerns over Middle East oil supplies.

Brent crude fell 4.2 percent to $108.68 a barrel, and U.S. West Texas Intermediate crude fell 4.3 percent to $99.61 a barrel, The Wall Street Journal reported. The drop gave back part of last week's gains.

Iranian Foreign Minister Abbas Araghchi said Sunday that discussions through Qatari mediators were continuing but had not produced an agreement, according to ICANA, the Iranian parliament's news agency. He said an Iranian delegation had traveled to Qatar for the talks but no direct meeting with U.S. officials was planned.

The absence of an agreement was the central fact of the day's trading. News that talks were under way was enough to push prices down, but no confirmation arrived that supply disruptions had ended.

Goldman Sachs raised its oil price forecasts, citing Middle East supply risks. The bank now expects Brent to average $105 a barrel in December, up from $90, and $88 a barrel in 2027, up from $80. It said Brent could reach $140 a barrel in 2027 if Gulf production stayed 3.5 million barrels a day below its 2025 average.

Goldman Sachs estimated that a geopolitical risk premium of about $27 a barrel accounted for most of October's oil rally. It also said Brent could fall into the $60s if output recovered faster than expected after a lasting U.S.-Iran agreement.

Where oil goes next depends on whether the talks produce an agreement or military tensions rise again. On Monday, the market reacted first to the diplomatic side of that divide.