By ifeoma Onyekachi

Oil prices fell sharply on Monday after the President of the United States, Donald Trump, announced a halt to planned military strikes on Iranian energy infrastructure, citing progress in diplomatic talks with Tehran.

In a statement posted on his Truth Social platform, Trump said the United States and Iran had held “very good and productive conversations” over the past two days aimed at resolving ongoing hostilities in the Middle East. He added that he had directed the Department of War to postpone any military action against Iranian power plants and energy facilities for five days to allow negotiations to continue.

The announcement immediately affected global oil markets, triggering a sharp drop in crude prices and boosting stock markets at the start of trading, as investors reacted to reduced fears of supply disruptions from the Middle East.

Global benchmark Brent crude fell more than 15 percent during Monday’s trading session, dropping to a low of 96 dollars per barrel and falling below the 100-dollar mark for the first time since March 11. The United States benchmark, West Texas Intermediate (WTI), also declined by about 13.5 percent to a session low of 85.28 dollars per barrel.

However, prices later recovered part of the losses. By 11:30 GMT, Brent crude had rebounded to about 104 dollars per barrel, while WTI rose to around 90.55 dollars per barrel.

Oil prices had surged dramatically in recent weeks due to tensions and conflict in the Middle East, with Brent crude rising by more than 60 percent since the crisis began and reaching about 112 dollars per barrel earlier on Monday before Trump’s announcement.

Energy analysts say the market reacted quickly because any military strike on Iranian energy infrastructure could disrupt global oil supply, especially as Iran remains a major oil producer in the region. The temporary halt in military action reduced fears of supply shortages, leading to the price drop.

Financial markets also responded positively to the development, with major stock markets opening higher as investors anticipated reduced geopolitical risk and improved global economic stability if diplomatic talks continue successfully.

Market observers say oil prices are likely to remain volatile in the coming days, depending on the outcome of the ongoing negotiations between Washington and Tehran and the broader security situation in the Middle East.