Oil prices fell to their lowest level in more than a week on Monday, September 21, 2026, as hopes of a diplomatic breakthrough between the United States and Iran reduced concerns over prolonged conflict and supply disruptions.
Brent crude futures dropped $2.16, or 2.08%, to $101.71 a barrel by 0213 GMT, after declining 0.91% in the previous session. The benchmark earlier touched $101.71, its lowest level since September 10.
US West Texas Intermediate (WTI) crude also fell $2.15, or 2.14%, to $98.15 a barrel, following a 1.58% decline on Friday.
Tim Waterer, chief market analyst at KCM Trade, said the decline reflected expectations that diplomatic efforts could help de-escalate the conflict.
“It seems that a degree of risk premium is being removed from oil prices on hopes that a diplomatic path to de-escalate the US-Iran war may arrive this week,” Waterer said.
He, however, cautioned that it remained uncertain whether the diplomatic expectations would materialise.
The United States and Iran exchanged fresh threats on Sunday as the conflict remained deadlocked, although US President Donald Trump said he was open to meeting Iranian President Masoud Pezeshkian.
Pezeshkian is expected to travel to New York this week for the United Nations General Assembly, raising expectations that diplomatic contacts could take place on the sidelines of the meeting.
Iran has also communicated conditions to mediators for a possible resumption of negotiations aimed at ending the conflict, according to Iran’s security chief, Mohsen Rezaei, as cited by Al Jazeera.
Despite the diplomatic expectations, tensions across the Middle East remained high.
Yemen’s Iran-backed Houthi group said it attacked what it described as “sensitive” sites in Saudi Arabia’s capital, Riyadh, with missiles and drones on Saturday.
The group also claimed an attack on an Aramco facility in Yanbu, a key oil-export hub on Saudi Arabia’s Red Sea coast.
The latest developments kept geopolitical risks elevated in global energy markets, even as expectations of possible US-Iran negotiations exerted downward pressure on crude prices.
