Investing.com– Oil prices edged lower in Asian trading on Tuesday, falling for a second straight session as diplomatic efforts to ease the U.S.-Israeli war with Iran tempered fears of a broader regional escalation.
As of 20:10 ET (00:10 GMT), Brent Oil Futures expiring in December fell 0.6% to $115.15 per barrel, while West Texas Intermediate (WTI) crude futures slipped 0.5% to $105.25 per barrel.
The retreat followed a rally last week that pushed Brent crude futures to six-month highs, driven by fears of further attacks on energy infrastructure and commercial shipping in the Middle East.
The latest diplomatic push has focused on talks involving Iran, Saudi Arabia, Turkey and Pakistan, while Qatari officials have also been engaging with Tehran in efforts to prevent the conflict from widening.
Senior officials from Saudi Arabia, Turkey and Pakistan met Iranian leaders in Tehran on Monday, seeking to reduce regional tensions and open channels for negotiations.
Discussions included Houthi attacks on Saudi Arabia, the possibility of U.S.-Iran talks, disruptions to shipping through the Strait of Hormuz and Washington’s blockade of Iranian ports, reports showed.
The diplomatic efforts have helped ease some of the immediate concerns about further military escalation, but investors remain cautious about whether they will produce a lasting de-escalation.
U.S. President Donald Trump has continued to leave open the possibility of further military action against Iran, while Tehran has said negotiations with Washington would require concessions, including an end to the U.S. blockade and the lifting of sanctions on Iranian oil exports.
The risks to supply remain substantial. The Iran conflict has disrupted commercial shipping through the Strait of Hormuz and the Bab el-Mandeb Strait, two important routes for global energy trade.
Houthi forces said on Monday they had attacked pumping stations on Saudi Arabia’s East-West crude pipeline and Riyadh airport, although Saudi Arabia had not immediately confirmed the claims. The kingdom has reported intercepting missiles and drones in recent days.
The International Energy Agency’s executive director, Fatih Birol, said on Monday that energy markets were unlikely to return to their pre-war conditions in 2027, underscoring concerns about the lasting impact of the conflict on supply chains.