Oil markets came under heavy selling pressure in early Asian trading on Monday, with prices sliding more than 3% after signs of dialogue between the United States and Iran prompted traders to scale back geopolitical risk premiums. The move was reinforced by profit-taking following last week’s rally.
The pullback came shortly after the Organization of the Petroleum Exporting Countries and its allies (OPEC+) wrapped up a weekend meeting without changing output levels, a decision that was widely anticipated by the market.
Brent crude futures for April delivery were down 3.3% at $67.07 a barrel by 20:31 ET (01:31 GMT).
Crude had climbed to near six-month highs last week, driven by fears of escalating U.S. military action against Iran and by supply concerns linked to extreme cold weather across parts of North America. On Monday, however, traders moved to lock in gains, reversing part of those advances.
Oil was also pressured by a strengthening U.S. dollar, which rebounded from four-year lows after President Donald Trump nominated Kevin Warsh as the next chair of the Federal Reserve. A firmer dollar typically weighs on commodity prices by making dollar-denominated assets more expensive for non-U.S. buyers.
Trump says Iran is “seriously talking” with Washington
Over the weekend, U.S. President Donald Trump said Iran was “seriously talking” with his administration, raising hopes of a potential easing in tensions between the two countries.
His remarks followed statements from Iranian officials indicating that preparations were under way for negotiations with the United States.
Trump has repeatedly threatened Iran with military action over its nuclear programme and ongoing domestic protests, and has ordered the deployment of U.S. naval assets to the Middle East. Those steps had previously heightened fears of renewed U.S. strikes, lifting concerns about regional instability and possible disruptions to oil supply.
As a result, crude prices had surged as markets built in a higher risk premium. Geopolitical uncertainty, combined with recent weather-related supply disruptions in the United States, had helped oil prices shrug off concerns about weak global demand and the risk of excess supply in 2026. More recently, a major production outage in Kazakhstan also lent support to prices.
OPEC+ keeps production unchanged
OPEC+ confirmed on Sunday that it would maintain oil production levels for March, reiterating its earlier decision to pause further output increases despite the recent rebound in prices.
The group had increased production by around 2.9 million barrels per day during 2025, but announced in November that any additional hikes would be put on hold indefinitely. Over the past year, oil prices have fallen by roughly 20%.
The alliance offered no guidance on future production policy, reflecting heightened uncertainty around the global economic outlook and ongoing geopolitical risks.
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