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Oil Prices Plummet as Iran Deal Looms
25 May
Summary
- Crude oil prices significantly dropped below $100 and $90 per barrel.
- The US and Iran are reportedly nearing a memorandum of understanding.
- Falling energy prices could enable the US Federal Reserve to lower interest rates.
Global oil prices saw a significant decrease in early trading on Monday, May 25, 2026. Brent Crude dropped over 5% to fall below $100 per barrel for the first time this month, while US crude, West Texas Intermediate (WTI), also declined towards $90 a barrel.
These price drops occurred despite a continued US blockade of the Strait of Hormuz, with senior officials indicating a final deal could take several days. Market watchers attributed the price fall to the receding "fear premium" as talks between the US and Iran appear to be progressing toward a memorandum of understanding.
Analysts suggest that a resolution could ease concerns over the Strait of Hormuz, a critical chokepoint for global oil traffic. Kevin Hassett, White House Chief Economic Adviser, expressed optimism that falling energy prices could pave the way for the US Federal Reserve to cut interest rates.
