Oil prices moved lower on Monday after gains in the previous session, as signs that unrest in Iran was subsiding reduced fears of a U.S. military response that could disrupt supplies from the key Middle Eastern producer.
Brent crude was trading at $63.85 a barrel at 0734 GMT, down 28 cents, or 0.44%. U.S. West Texas Intermediate crude for February slipped 36 cents, or 0.61%, to $59.08 a barrel. With the February contract expiring on Tuesday, the more actively traded March contract was down 24 cents, or 0.40%, at $59.10.
Protests in Iran sparked by economic hardship appear to have been brought under control following a violent crackdown that officials say left 5,000 people dead.
U.S. President Donald Trump appeared to soften his earlier stance on intervention, saying on social media that Iran had halted mass executions of protesters, although no such plans were officially announced by Tehran. The remarks helped ease concerns that Washington might launch military action capable of interrupting oil exports from Iran, the fourth-largest producer in OPEC.
The pullback signalled a further retreat from the multi-month highs reached last week, even though prices still ended higher on Friday. At the same time, the repositioning of U.S. military assets toward the Gulf continues to underline lingering geopolitical uncertainty.
“The pullback followed a swift unwind of the ‘Iran premium’ that had driven prices to 12-week highs, triggered by signs of easing in Iran’s crackdown on protesters,” IG market analyst Tony Sycamore said in a note.
He added that the decline was reinforced by U.S. inventory data showing a sizeable build in crude stocks, adding to bearish pressure on the supply side.
U.S. financial markets are closed on Monday for the Martin Luther King Jr. Day holiday.
Figures released last week by the Energy Information Administration showed U.S. crude inventories increased by 3.4 million barrels in the week ended January 9, compared with expectations in a Reuters poll for a 1.7 million-barrel draw.
Markets are also watching developments in Venezuela after Trump said the United States would take over the country’s oil industry following the capture of Nicolas Maduro. The U.S. energy secretary told Reuters on Friday that Washington is moving quickly to grant Chevron an expanded licence to produce in Venezuela.
However, investors remain cautious about the scope for a rapid ramp-up in Venezuelan output.
“Venezuela and Ukraine remain on the back burner,” said Vandana Hari, founder of oil market analysis firm Vanda Insights.
“Expect rangebound movement for the rest of the day, with U.S. markets closed.”
Separately, government data released Monday showed China’s refinery throughput rose 4.1% year on year in 2025, while crude oil production increased 1.5% from 2024, with both reaching record levels.
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