Trump claimed the U.S. is in 'deep talks' with Iran - but an Iran government spokesman said there are no such discussions
Brent crude-oil prices have fallen by more than 13% so far this week, after the U.S. paused attacks on Iran last weekend.
Oil futures fell for a third straight session on Tuesday, with global prices settling at their lowest level in about two weeks, as Israel Prime Minister Benjamin Netanyahu met with U.S. President Donald Trump to discuss their war with Iran.
The U.S. and Iran, meanwhile, continued a mutual pause in strikes that began over the weekend.
The selling in crude is "overdone," said Tariq Zahir, managing member at Tyche Capital Advisors. Trump has claimed that Iran is talking with the U.S., feeding hopes for a peace deal - but "history has shown us that Iran hasn't been willing to agree to anything," Zahir said.
The Brent crude contract for September delivery (BRN00) (BRNU26) tumbled 4.8% to settle at $84.09, with the front-month contract settling at the lowest level since July 13, according to Dow Jones Market Data. The West Texas Intermediate crude September contract (CL.1) (CLU26) shed 4.1% to end at $79.26, its lowest level since July 16. Both contracts fell for a third session in a row.
There hasn't been any news that would fuel buying in crude oil at this point, as the U.S. and Iran have paused their strikes and Trump has said he's giving a chance for talks to progress, Zahir told MarketWatch. "Of course, this could change in an instant on one headline," he added.
Trump told Axios on Monday that he had paused strikes to allow time for negotiations with Tehran. "We are in very deep talks with Iran," Trump said. "If they don't work out, we will go back to very strong military action."
However, Esmaeil Baghaei, a spokesman for Iran's Foreign Ministry, said in a televised press conference Monday that Tehran is not currently engaged in peace talks with Washington.
Iran "will never allow the United States to determine the timing of war and peace," Baghaei said.
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Crude oil is obviously quite volatile at the moment, said Zahir. As a result, traders are reluctant to take positions for now, and are instead focusing on Big Tech earnings and the Federal Reserve's interest-rate policy decision this week until they know whether U.S. and Iranian attacks are going to start again, he said.
"We do think crude will take center stage again later this week when we see some clarity on what is going to happen in the Middle East," Zahir said. "The risk in our opinion is to the upside" for oil prices, he noted.
According to a Bloomberg report, negotiating teams from Iran and Oman are trying to reach a deal to resume shipping through the Strait of Hormuz. If they're successful in formulating an agreement, it could allow the U.S. and Iran to restart talks on ending the five-month-long conflict, Bloomberg reported, citing people described as familiar with the situation.
Separate conversations were also held by Iranian Foreign Minister Seyed Abbas Araghchi and his counterparts, Saudi Arabia's Faisal bin Farhan and Oman's Badr al-Busaidi, according to a statement posted on Telegram.
"The oil-and-gas industry came into 2026 bracing for a difficult year," analysts at research provider Wood Mackenzie wrote in a note on Tuesday. "What it got was a price surge, an unplanned cash windfall and a set of strategic pressures that, if anything, have grown more urgent."
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