Oil prices are falling sharply. Lowered U.S.-Iran tensions and metals spillover is being blamed.

MW Oil prices are falling sharply. Lowered U.S.-Iran tensions and metals spillover is being blamed.

By Barbara Kollmeyer

OPEC+ says pause on production hikes will continue

Women walk past a mural painted on the outer walls of the former US embassy in Tehran, colloquially-referred to as the "Spy Den,"on February 1, 2026. Oil prices are falling on Monday amid hopes for U.S.-Iran talks.

Oil prices fell sharply on Monday after President Donald Trump said he was hopeful over negotiations with Iran, taking some of the fear premium out of the commodity.

West Texas Intermediate crude for March delivery (CLH26) (CL.1) slid 5.5% to $61.60 a barrel, after the contract gained 14% for January, following five straight months of losses.

Brent crude futures (BRN00) (BRNJ26) fell over 5% to $65.64 a barrel.

"Hopefully, we'll make a deal. If we don't make a deal, we'll find out whether or not he was right," said Trump, who had also made comments about hopes for negotiations.

The Iranian Tansim news agency reported that Iran-U.S. talks are likely in the coming days.

Worsening U.S.-Iran tensions drove Brent, the global benchmark, to its highest since last July on Thursday. Those tensions plus angst over the U.S. arrest of Venezuela's president and effectively taking control of that nation's oil industry, have contributed to January's surge in oil prices.

Despite rising geopolitical tensions in January, however, the global oil market is still expected to see a supply surplus this year. The Organization of the Petroleum Exporting Countries and its allies, the group of major oil producers known as OPEC+, on Sunday reaffirmed their decision late last year to continue to pause production hikes in March.

Analysts at Saxo Bank added that oil markets are also seeing spillover pressure from the rout in precious and base metals.

Losses were being seen across the energy complex on Monday, with natural gas futures (NG00) slumping 15% to $3.66 per million British thermal units. Extreme cold and wintry weather across the U.S. contributed to an 18% surge in prices for January, the biggest one-month percentage gain since October.

Prices for reformulated gasoline (RB00) slid nearly 4% to $1.865 a gallon and heating oil futures (HO00) slid 4% to $2.424

-Barbara Kollmeyer

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February 02, 2026 05:58 ET (10:58 GMT)

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