During the Asian and European session on Tuesday (November 10), international oil prices continued to decline following a sharp drop on Monday evening, with front-month WTI crude trading near 85.32, down 1.80%.
Oil prices have been continuously driven by global geopolitical news recently. Last night, according to a report citing Arab sources, a proposal put forward by Qatar and Pakistan reactivated substantive negotiations between the United States and Iran, with the two sides expected to reach a preliminary agreement on Iran's uranium enrichment issue. Rumors involving a resolution to the nuclear issue briefly sent Brent crude plunging more than 5% intraday, while spot gold and silver rose in tandem and the Nasdaq extended gains to 3%.
However, US President Trump subsequently held an emergency meeting with Qatar's Prime Minister at the White House. After the meeting, Trump said Qatar and Saudi Arabia hope for a peaceful resolution to the Iran conflict, but the United States is prepared to resume military strikes if necessary. Trump added that the two sides discussed Iran-related issues in depth, and that Qatar, Saudi Arabia, the UAE, Bahrain, Kuwait and other countries prefer to maintain the status quo, namely continuing the "largest naval blockade in history," while indicating that the likelihood of continued large-scale strikes is not high. In other words, Trump wants to end the war with dignity, but Iran has not made its position clear and has also denied the nuclear negotiations. Meanwhile, Russia-Ukraine talks are underway, and the positive progress from negotiations eased geopolitical tensions, sending oil prices lower.
US-Iran Talks See-Saw as US Political Scene Shakes Again
Qatar and Pakistan took the lead in proposing a new plan to push the US and Iran back to the negotiating table. Reports suggest the two sides drafted a preliminary agreement: the US would allow Iran to maintain uranium enrichment at 3.67%, Iran would agree to dilute its 60% highly enriched uranium stockpile with third-country assistance in processing it, and International Atomic Energy Agency inspectors would be arranged to return to Iran. The Strait of Hormuz blockade would be lifted, and the US would release $6 billion to $9 billion in frozen Iranian assets.
But the negotiations immediately took a turn. Iran's top security official directly dismissed the talks as fake news, demanding that the US accept seven negotiating conditions proposed by Iran and refusing to compromise under coercion. At the same time, Trump publicly signaled de-escalation, saying at an impromptu press conference that the Iran conflict would soon come to an end and that there was no need to launch military strikes at this stage. He later added on social media that multiple Middle Eastern countries still support maintaining the naval blockade and advancing "Operation Iron Gate," that there is no room for negotiation on Iran's nuclear weapons issue, and that US forces are ready to act at any moment if the situation changes suddenly.
Iranian senior officials also stated in tandem that the Supreme Leader has ordered an end to the "neither war nor peace" state and is willing to open negotiations, but will not accept bullying terms from the US. There were also reports that Iran has made concessions on conditions for navigation through the Strait of Hormuz. Meanwhile, the US political scene has shifted, with House members formally submitting a resolution to initiate impeachment proceedings against Defense Secretary Hegseth. External military operations combined with internal political strife further increase uncertainty in US Middle East policy.
Affected by the持续 escalation of Iranian military threats, US forces have again reduced their footprint, evacuating aerial refueling tankers from RAF Mildenhall in the UK for the second time and relocating them to a base in Germany. The Pentagon had previously withdrawn B-1 bombers stationed in the UK to avoid the risk of Iranian drone attacks.
Strait of Hormuz Shipping Continues to Recover, but Navigation Risks Remain High
Although geopolitical friction has not subsided, crude oil and LNG outbound volumes through the Strait of Hormuz have steadily recovered. Saudi shipping company Bahri, under US coordination, dispatched four tankers through the strait that day, steadily resuming crude oil exports and gradually bringing shipment volumes back to pre-conflict levels. Ship tracking data shows that 31 LNG vessels departed through the Strait of Hormuz in October, a single-month high since the conflict broke out. Qatar's exports recovered to more than 30% of pre-war levels, and the UAE's transit volume has fully returned to pre-conflict levels.
However, navigation safety hazards have not been eliminated. Ship attacks in the strait remain frequent, and the naval blockade has not been completely lifted. Houthi forces along the Red Sea continue to act in coordination with the situation, persistently disrupting shipping through the Bab el-Mandeb Strait and repeatedly clashing with the Saudi-led coalition. With both key shipping lanes under pressure simultaneously, global oil transport costs remain elevated, and the shipping market remains shrouded in geopolitical risk.
Institutional View: Short-Term Premium Retreats, Medium- to Long-Term Oil Price Risks Still Tilt Upward
Institutional assessments of the current Middle East situation suggest that it will be very difficult for the two US parties to reach a compromise on Iran's core demands, and the situation will maintain a pattern of "controllable escalation of conflict and difficult-to-resolve negotiation deadlock." On one hand, congressional fiscal appropriation constraints and voter war-weariness will limit Trump from rashly expanding military operations. On the other hand, Iran's core strategic demands are difficult for the US to accept, making a diplomatic breakthrough extremely challenging.
Goldman Sachs reminded traders not to be overly optimistic. Although short-term negotiation news has erased part of the extreme risk premium, shipping safety in the Strait of Hormuz remains fragile until a formal written agreement is reached. The bank raised its medium- to long-term oil price forecasts, lifting its end-2026 Brent crude target to $105 per barrel and WTI to $94 per barrel. It also raised its 2027 Brent average to $88 per barrel and WTI to $78 per barrel, saying geopolitical supply risks remain the core theme supporting oil prices.
Summary and Technical Analysis:
Short-term oil prices are completely dominated by geopolitical news. Positive progress in US-Iran and Russia-Ukraine talks will quickly pressure oil prices, while any breakdown in negotiations or escalation of hardline rhetoric will immediately send oil prices rebounding. But unlike before, Trump has lost bipartisan support, and his Defense Secretary is undergoing impeachment proceedings. This makes the sustainability of the war uncertain — first and foremost, military funding cannot be approved. It remains to be seen whether the US can quickly secure negotiation results. On the shipping side, continued recovery in Strait of Hormuz volumes supports spot supply, but Iran and the Houthis could restart ship attacks at any time, and the risk of shipping lane disruption has not been fully cleared.
The supply premium from geopolitical conflict has not completely faded. Even if short-term negotiation setbacks trigger a rebound in oil prices, the start of Russia-Ukraine talks and the change in power in the US Congress cap the upside for oil prices. Going forward, trading will require keeping a close eye on the details of US-Iran diplomacy and Russia-Ukraine negotiations on one hand, while continuously tracking tanker traffic through the strait and Houthi movements in the Red Sea on the other.
Technical Picture:
The front-month WTI crude has broken below the neckline of a double-top pattern. If oil prices cannot quickly recover the lost ground near 87-88 in the short term, there is a risk of falling toward 70. As of 16:21 Beijing time, front-month WTI crude was reported at $85.10 per barrel.
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