Oil prices fall as first round of peace talks ends

• US and Iran conclude high-level Swiss talks
• Qatar says roadmap agreed for final deal
• Brent crude drops more than 2%

Oil prices declined in early Monday trading after the US and Iran concluded a first round of high-level peace talks in Switzerland.

Brent crude futures fell 2.15 percent to $78.84 a barrel by 03:00 GMT, after touching a high of $82.30. US West Texas Intermediate crude futures slipped 1 percent to $75.02 a barrel.

Oil dropped more than 8 percent last week on an interim peace deal, or memorandum of understanding (MoU), between the two sides.

The foreign ministry of Qatar, which is helping to mediate the talks, said in a statement that the US and Iran had agreed on a roadmap to reach a final deal within 60 days.

The parties have agreed to establish a high-level committee to provide political oversight on the discussions.

Chief negotiators will report regularly to the committee and lead working groups focused on nuclear issues and sanctions, while a monitoring and dispute-resolution group will ensure effective implementation of the MoU, the statement said.

Technical talks will continue for the rest of the week in the Swiss mountain resort of Burgenstock, owned by a Qatari group.

However, the Strait of Hormuz will remain closed unless Israel’s actions in Lebanon are brought under control, Iran’s semi-official Tasnim news agency reported on Sunday, citing an unidentified source close to Iran’s negotiating team.

The agency, without citing any source, later said Iran will stop negotiations unless Israel withdraws from Lebanon.

The conflict began on February 28 and lasted just over 100 days before the announcement of the peace agreement last week. Pakistan and Qatar helped broker the deal, which aims to restore shipping, energy flows and regional stability.

In a Truth Social post, US President Donald Trump said the Iranians must immediately ​”stop their ​highly paid proxies in ‌Lebanon ⁠from causing trouble”, otherwise “we’ll hit Iran very ​hard again”.

The market’s expectation of a reopening of the strait, through which a fifth of the world’s oil supply normally flows, has been premature, MST Marquee’s energy research head Saul Kavonic told Reuters.

Iran is likely to continue to find pretexts to stymie flows through the strategic waterway, as that remains Tehran’s only leverage, he added.

Meanwhile, Iraq intends gradually to increase crude production to nearly 4.3 million barrels per day, the state-owned Iraq News Agency reported, quoting an oil ministry statement.

Kuwait Petroleum Corporation CEO Sheikh Nawaf Saud Al-Sabah said last week that the company aims to ramp up production to 2 million bpd within a week and will immediately lift force majeure notices.

Further reading:

• Shipping industry urges caution on Hormuz reopening
• Robin Mills: Markets should not assume danger has passed
• Gulf seafarers’ PTSD claims raise questions on costs

The International Energy Agency expects oil production and exports from GCC countries to recover gradually if the US-Iran peace deal holds, potentially creating a significant surplus in 2027.

In other markets, gold prices rose almost 1 percent to $4,197.41 per ounce in early Monday trade on progress in the peace talks and the drop in oil.

On Sunday, the Saudi stock exchange fell 0.4 percent, weighed down by mining giant Maaden and banking heavyweight Saudi National Bank.

The Qatari bourse slipped 0.3 percent, driven by a fall in Qatar National Bank, the biggest lender across the GCC.

The Omani and Kuwaiti stock markets were down, while the Bahraini index rose marginally.