Oil plummets more than 8% with signs of peace between Iran and the United States and Brent threatens to lose US$100

Oil plummeted this Monday (2), and Brent fell almost 8%, to a level of around US$ 104 per barrel. According to Money Times, at around 3:40 pm (Brasília time), the January 2027 contract traded on ICE London fell 8.23%, quoted at US$104.09. WTI, due in December, fell 7.92% to US$95.87 per barrel on the Nymex. The drop left Brent close to losing the US$100 mark.

The backdrop is the expectation of a peace agreement between Iran and the United States. According to the Money Times, Iranian negotiators have been talking to Qatari mediators for days, and a draft proposal is circulating between the parties. An official interviewed by Reuters mentioned the possibility of a follow-up meeting. For the energy market, any sign of normalization in the Middle East weighs directly on prices, because the conflict had increased the geopolitical risk embedded in prices.

In the Pod Force One podcast, on the 2nd, President Donald Trump stated that the war with Iran is not over yet and that Iran wants to continue talks to reach an agreement. He said the United States could take further action and that Iran could not have nuclear weapons. Regarding the Iranian disposition, Trump stated that Tehran wants an agreement, but stressed “we will see”. He also claimed that the US overthrew two Iranian regimes, that oil stocks are above pre-war levels and that the Strait of Hormuz remains closed. These are statements made by Trump himself, with no data to confirm them in this text.

In European markets, the signal was bullish. According to the Money Times, the Stoxx 600 rose 0.45%, to 649.65 points, and the DAX advanced 0.64%, to 25,982.87 points. In London, the FTSE 100 gained 0.29%, to 10,761.33 points, while the CAC 40, in Paris, rose 0.98%, to 8,047.69 points. The same publication attributes the strength of the bloc to the expectation of an agreement between the USA and Iran and the fall in oil prices.

In Canada, the Toronto Stock Exchange also followed the commodity. According to Investing.com, the TSX rose with the fall in oil prices and the expectation of peace between the two countries, and the same source cites an increase in material stocks, without detailing numbers. For those who follow the sector, the price began to depend on both diplomatic news and supply data, as shown by Trump's statements about stocks and the Strait of Hormuz.

What changes for the investor

Today's drop reflects, in practice, the possibility of de-escalation in the Middle East. If the talks progress and the passage through Hormuz is normalized, oil may remain under pressure; If dialogue stalls, volatility tends to return, especially given the threat of new measures cited by Trump. For energy companies, the price of a barrel affects revenues and margins, and the effect on inflation and interest rates will depend on how long the decline lasts. Anyone who follows the stock market, Nasdaq, interest rates and the dollar should observe the evolution of negotiations and stock data, without taking the movement of a single day as a trend.

Automatically translated from Portuguese.