Oil prices fell below $100 per barrel on Wednesday as easing Middle East tensions reduced supply disruption concerns and triggered a market selloff.
Brent crude dropped about 5 percent to around $99 per barrel, while U.S. West Texas Intermediate (WTI) also traded lower.
The decline follows reports that the United States has proposed a ceasefire framework to Iran, raising expectations that crude exports from the region could resume and stabilize global supply.
The easing geopolitical tension triggered a sell-off in oil, reversing part of the sharp gains recorded earlier this month when prices surged above $110 per barrel amid heightened conflict risks.
Market sentiment improved as traders began pricing in a potential de-escalation, which could reopen key supply routes, including flows through the Strait of Hormuz, a critical channel for global oil shipments.
Despite the recent drop, oil prices remain elevated compared to pre-conflict levels, reflecting ongoing uncertainty in global energy markets.
Brent crude is still significantly higher than levels recorded before the escalation of tensions, underscoring continued supply risk.
Analysts say oil will remain highly volatile in the near term, driven by geopolitical developments, supply expectations, and shifts in global demand.