Oil prices fell sharply on Monday after US President Donald Trump announced a temporary pause in planned military strikes on Iran’s energy infrastructure, citing progress in diplomatic talks.

Brent crude dropped nearly $17, or about 15%, to an intraday low of $96 per barrel, while US West Texas Intermediate (WTI) fell $13, or roughly 13.5%, to $85.28. Prices later recovered some losses, with Brent trading near $105 per barrel (down 6.35%) and WTI at $91.9 (down 6.45%) at the time of reporting.

The decline came after Trump signaled easing tensions in the Middle East, a critical region for global oil supply. In a post on Truth Social, he said the United States and Iran had engaged in “very good and productive conversations” over the past two days aimed at resolving hostilities.

He added that, based on the “in-depth, detailed, and constructive” nature of these discussions, he had directed a five-day postponement of any military action targeting Iranian power plants and energy facilities. The pause, he said, would depend on continued progress in ongoing talks throughout the week.

The market reaction reflects a sharp reduction in geopolitical risk, which had previously driven prices higher. Disruptions linked to tensions in the region—including threats to the Strait of Hormuz and attacks on key infrastructure—had cut global oil supply by an estimated 11 million barrels per day.

With diplomatic engagement now underway, investors are increasingly betting on a potential de-escalation, raising the possibility of a ceasefire in the coming weeks.