Oil prices extended their decline on Monday, after recording their steepest weekly drop since April 2020.
Brent crude futures fell below $98 per barrel, trading at around $97.97 in early Asian trade after losing more than 16% last week. US West Texas Intermediate (WTI) crude traded near $90.
Prices have retreated from a six-month high reached in late October, as traders assess the possibility of a diplomatic resolution to the US-Iran conflict following the US midterm elections.
US Secretary of State Marco Rubio described Iran’s demands in negotiations as unacceptable, while President Donald Trump indicated that further military strikes were highly unlikely if talks made substantial progress. The contrasting statements have added uncertainty to the market outlook.
The UK Maritime Trade Operations reported that an unknown projectile struck a tanker travelling outbound through the Strait of Hormuz over the weekend.
Separately, Iran-backed Houthi rebels attacked Riyadh, damaging offices of Saudi oil giant Saudi Aramco. Saudi Arabia reported minor damage and no casualties, while its forces destroyed two missile launchers in retaliation.
Aramco has faced repeated attacks since the US-Israel war with Iran began in late February, raising concerns about regional energy infrastructure and shipping routes.
Asian markets opened unevenly on Monday. Japan’s Nikkei 225 rose 1.44% and Topix gained 2.09%, while South Korea’s Kospi fell 0.69% and Australia’s ASX 200 declined 0.31%.
