Brent Oil Posts Biggest Monthly Loss in Six Years on Iran Deal Hopes

CNBC reported Friday that Brent crude recorded its steepest monthly decline in six years during May. Markets were pricing in growing optimism that Washington and Tehran are moving toward a formal agreement.

Oil’s Sharpest Monthly Drop Since the Pandemic

Brent crude lost more than 19% across May, its worst monthly performance since March 2020. That month, pandemic lockdowns collapsed global fuel demand almost overnight. U.S. benchmark West Texas Intermediate fared only slightly better, shedding nearly 17% over the same period. That marks WTI’s worst month since April 2025.

On Friday alone, both benchmarks slipped further. WTI closed down roughly 1.7% at $87.36 per barrel. Brent settled around $92.05, off by a similar margin. Traders reacted after President Donald Trump said he would convene a session in the White House Situation Room to make a final call on any Iran agreement.

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What a Deal Would Mean for the Strait of Hormuz

The central prize in any agreement is unrestricted passage through the Strait of Hormuz. The waterway handles a significant share of global seaborne oil flows, and its closure following last year’s U.S. and Israeli strikes on Iran sent energy markets sharply higher. A reopening would put meaningful new supply back within reach of international buyers.

U.S. officials told CNBC on Thursday that negotiators had already drafted a 60-day memorandum of understanding. The MOU would extend the existing ceasefire and open formal talks on Iran’s nuclear program. Trump had not yet signed the document, officials said. Axios first reported the existence of the draft agreement.

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Trump’s Demands Complicate a Final Agreement

Despite the progress, Trump outlined conditions Tehran has historically refused. Iran must permanently renounce nuclear weapons, he said. It must also allow free and unimpeded passage through the Strait of Hormuz with no tolls imposed on vessels. Additionally, any remaining naval mines must be cleared immediately from the waterway.

Trump added a further demand that raised the stakes considerably. Iran must permit U.S. personnel to locate and destroy enriched uranium buried beneath rubble left from last year’s strikes. Those conditions represent a maximalist position that previous negotiating rounds failed to resolve.

Analysts have noted that even a temporary framework could keep prices under pressure if markets believe a durable deal is achievable within months.

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