Crude oil prices decline up to 2% as hopes of US-Iran de-escalation weigh

New Delhi: Global crude oil prices declined on Monday after surging to near six-month highs recently on hopes of easing hostilities between the US and Iran, though persistent attacks on key producer Saudi Arabia kept investors cautious.

Brent crude -- the international oil benchmark -- declined as much as 2.29 per cent or $2.68 to $114.04 per barrel by 10:20 am. It was trading at $114.44, down 1.95 per cent.

Similarly, US West Texas Intermediate (WTI) dropped 2.49 per cent or $2.58 to $100.69 per barrel.

The decline followed overbought signals after Brent surged nearly 90 per cent this year on supply concerns. The prices had rallied on Friday to their highest since April amid reports that the US and Israel could prepare strikes on Iran after the US midterm elections in early November.

Commodity market experts said, "Crude oil fell below $102 a barrel, retreating from recent highs despite fears that strikes against Iran could resume after Israeli elections this week and US midterm elections next week.

“US President Donald Trump said on Sunday he would soon decide whether to pursue a deal with Tehran or restart military operations, while threats from Iran and the Houthis against Americans in the Middle East continue to escalate,” the experts added.

Clashes between Saudi Arabia and Iran-backed Houthi rebels intensified over the weekend, though Middle Eastern crude exports have recovered to near pre-war levels, according to them.

However, the narrow waterway connecting the Persian Gulf to global markets remains a focal point.

Iranian Foreign Minister Abbas Araghchi said the US and Israel would not attempt an attack if rationality prevailed.

Fighting between Saudi Arabia and Iran-backed Houthi rebels in Yemen also added to supply risks.

The Houthis claimed they targeted King Khalid International Airport in Riyadh in response to Saudi strikes on Sanaa, as per reports.

Notably, higher oil prices weighed on US equities as major indices ended lower on Friday despite some stabilisation in technology shares after a volatile week for AI-related stocks.

Asian markets traded cautiously as oil prices retreated from six-month highs with investors bracing for a busy week of central bank meetings and corporate earnings that could test confidence in the AI-driven rally.