Crude Oil Slumps As US-Iran Talks Show Signs Of Progress

Crude oil prices tumbled more than 2.5% on Monday as President Donald Trump’s administration and Iran’s government took a step forward in inking a potential nuclear deal.

West Texas Intermediate crude futures traded at $62.38 at the time of writing, down 2.55% or $1.63 from Thursday’s closing price.

Brent crude futures traded at $66.38, down 2.32%.

Trump’s tariff war and the possibility of a nuclear deal between the U.S. and Iran eased concerns about demand.

Both the U.S. and Iran have tasked experts with creating a framework for a potential nuclear deal following “progress” in bilateral talks, as reported by Reuters.

Earlier, in an interview with CBS News, Chicago Fed President Austan Goolsbee pointed to the possibility of a slowdown in economic activity this summer after an “artificially high” bump before Trump’s tariffs kick in.

Apollo Global Management economist Torsten Slok told MarketWatch that the possibility of a recession has climbed to 90%.

Slok added that small businesses don’t have the working capital required to pay for the tariffs.

“Expect ships to sit offshore, orders to be canceled, and well-run generational retailers to file for bankruptcy,” he said.

With an increasing possibility of tensions between the U.S. and Iran easing, IG Market Strategist Yeap Jun Rong expects crude oil prices to inch lower.

"The broader trend remains tilted to the downside, as investors may struggle to find conviction in an improving supply-demand outlook, especially amid the drag from tariffs on global growth and rising supplies from OPEC+," Rong told Reuters.

Amid market uncertainty, U.S. stock futures inched lower, with the tech-heavy Nasdaq 100 futures losing the most at 1.52%, while S&P 500 futures fell 1.2% at the time of writing.

The SPDR S&P 500 ETF (SPY), which tracks the S&P 500 index, was down 1.10% in pre-market hours on Monday.

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