By Maha Shahid
August 5, 2026 6:01 amOil prices extended losses Wednesday as traders weighed renewed US-Iran negotiations and a pause in US attacks against Iran, reducing the geopolitical risk premium in crude markets.
International benchmark Brent crude futures for October traded at $79.29 per barrel at 9.40 a.m. local time (0640 GMT), down 0.09% from the previous close of $79.36.
US benchmark West Texas Intermediate (WTI) futures traded at $75.40 per barrel, down 0.5% from $75.77 in the previous session.
The US, Iran and Oman are nearing an interim agreement aimed at reopening the Strait of Hormuz and restoring a ceasefire between Washington and Tehran, with a possible announcement expected as early as Wednesday, the Axios news site reported Tuesday.
On Tuesday, Brent slipped below $80 a barrel after falling more than 5% as traders reduced the geopolitical risk premium incorporated into prices during the Middle East conflict.
Optimism in the market grew after US President Donald Trump said negotiations with Iran were advancing and suggested the Strait of Hormuz, a key route for roughly one-fifth of global oil supplies, could reopen soon.
Trump said there was an “all-day negotiation” on Tuesday with Iran. “They had an all-day negotiation today, and it looks like things are very good,” he added.
Later, speaking to reporters in California, he said the US is “moving along very nicely” with Iran. “We’ll find out. We’ll know in 48 hours,” he added.
Trump told Fox News that he had previously been prepared to launch a major attack against Iran but agreed to negotiations after Iranian officials requested talks, warning that Tehran would face a severe response if it abandoned the discussions. He reiterated that Iran cannot be allowed to develop a nuclear weapon.
He said US and Iranian officials were engaged in “very good discussions,” though he acknowledged that Tehran has not publicly confirmed the progress. “The only thing that matters is action, and they want to make a deal. We’ll see what happens.”
Growing expectations that diplomatic efforts could lead to the normalization of shipping through the Strait of Hormuz have eased concerns over supply disruptions, weighing on oil prices.
Investors also turned their attention to US inventory data after figures attributed to the American Petroleum Institute showed crude oil stocks rose by about 2.69 million barrels last week.
Some market estimates had pointed to a 2 million-barrel decline, with the unexpected build adding to signs of looser near-term US market conditions.
The market is awaiting official inventory data from the US Energy Information Administration later Wednesday, which could provide further direction for oil prices.
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