Oil prices fell sharply on Monday, November 2, as Iranian and Qatari officials held a third consecutive day of talks aimed at finding a way out of the conflict between the United States, Israel and Iran. The diplomatic activity, plus a weekend free of major escalation, eased fears that Middle East supplies could be disrupted, and traders took profits after a strong run last week.
FAKTA
- What happened: Brent crude fell more than 3 percent on Monday, to about $109.75 a barrel, while United States West Texas Intermediate crude dropped by a similar margin, to about $100.69 a barrel.
- Why prices fell: Iranian and Qatari officials continued talks for a third straight day, and no major military escalation took place over the weekend.
- What Iran said: Foreign Minister Abbas Araqchi said the discussions were continuing through Qatari mediators, and that Tehran remained ready for both defence and diplomacy.
- October context: Brent had ended October at its highest level in six months, as traders worried the conflict could intensify after Tuesday’s United States midterm elections.
- Supply decision: OPEC and its allies, including Russia, decided on Sunday to keep their December production targets unchanged.
Talks enter a third day
Araqchi said on Sunday that the contacts aimed to keep consultations going and seek a resolution, adding that Tehran was making every effort through diplomacy while remaining prepared to defend itself. Qatar has acted as mediator, and Monday morning reports described the talks as ongoing and progressing, with no agreement yet announced.
Market analysts linked the fall partly to that diplomatic signal and partly to the quieter weekend. After weeks in which tanker attacks in the Strait of Hormuz pushed shipping costs higher, the absence of a fresh clash gave traders room to reassess the risk premium in prices. Tim Waterer, chief market analyst at KCM Trade, called Monday’s move a technical pullback after last week’s sharp rally.
A fragile calm, not a settlement
Analysts cautioned against reading the fall as the end of the crisis. Waterer warned that stronger rhetoric toward Iran after the midterm elections could push Brent back toward $120 a barrel. Analysts at ING said prices would depend on whether the elections bring further military action or fresh diplomatic progress.
Shipping risks remain: tanker attacks in the Strait of Hormuz have raised costs in recent weeks. Saudi Arabia still increased crude exports in October from September, despite attacks by Iran-aligned Houthi forces on Saudi energy infrastructure. A sustained easing could relieve pressure on energy markets, but renewed hostilities could reverse Monday’s decline quickly.
What traders are watching next
Attention now turns to Tuesday’s United States midterm elections and to whether the contacts produce anything concrete. Traders will also watch Washington’s and Tehran’s language, any further tanker or Gulf energy incidents, and the next OPEC+ meeting. For now, Monday’s trading shows a market hopeful about diplomacy but far from convinced the danger has passed. Watan News International will continue to follow verified updates on the talks and on oil markets.
