By Adam Clark
Oil prices fell sharply early Monday after President Donald Trump said the U.S. and Iran have held talks about bringing an end to fighting in the Middle East.
Brent crude, the international standard, was down 6.8% at $104.52 a barrel. West Texas Intermediate, the U.S. benchmark, was falling 7.7% to $90.67 a barrel.
Trump said the U.S. and Iran have held "good and productive" conversations about a resolution to hostilities and that he had instructed the Department of War to postpone military strikes against Iranian infrastructure for a five-day period, in a post on Truth Social.
The president also hinted at a lasting agreement for opening the Strait of Hormuz, where around 20% of the world's daily oil production normally passes, which has been largely closed since the start of the Iran conflict.
"The Hormuz Strait will have to be guarded and policed, as necessary, by other Nations who use it -- The United States does not! If asked, we will help these Countries in their Hormuz efforts, but it shouldn't be necessary once Iran's threat is eradicated," Trump wrote.
Trump previously threatened to attack Iranian power plants if the Strait of Hormuz isn't opened within 48 hours, in comments made Saturday evening in the U.S. Iran had said it would retaliate with its own attacks on infrastructure.
Meanwhile, at least 40 energy assets have been severely damaged across nine countries since the Middle East conflict began, International Energy Agency Executive Director Fatih Birol said. Although the IEA is discussing further releases of oil stocks, such action wouldn't resolve the crisis, Birol said in a conference in Australia on Monday.
Before Trump's announcement, analysts at Goldman Sachs raised their forecasts for the average price of oil this year. They now expect Brent to average $85 a barrel in 2026 from $77 previously, and WTI to average $79 a barrel from $72 previously.
"Due to uncertainty around the duration of the shock and assuming that Hormuz flows remain at 5% through April 10, prices are likely to trend higher over that period until the market gains confidence that a lengthy disruption is unlikely," Goldman Sachs analyst Daan Struyven wrote in a research note.
Write to Adam Clark at adam.clark@barrons.com
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(END) Dow Jones Newswires
March 23, 2026 08:19 ET (12:19 GMT)
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