Oil prices tumbled sharply on Wednesday as renewed optimism over a possible United States–Iran peace agreement sent shockwaves through global energy markets.
International benchmark Brent North Sea crude fell by 6.2 percent to $103.04 per barrel, while West Texas Intermediate (WTI) dropped 6.4 percent to $95.68 per barrel.
The sudden decline comes amid reports that Washington and Tehran are exploring diplomatic steps aimed at ending long-running tensions in the Middle East. Traders reacted quickly, pricing in the possibility that reduced conflict could ease threats to global oil supply routes, especially the strategically important Strait of Hormuz.
Market analysts say the sell-off reflects fear-driven speculation easing off, as investors anticipate improved stability in global crude flow if tensions de-escalate. However, they also caution that no formal agreement has been reached, and the situation remains fluid.
Despite the sharp drop, volatility is expected to continue as oil markets remain highly sensitive to geopolitical developments in the region.