Brent crude prices dropped to their lowest levels since early March, settling at $87.33 a barrel on June 12, down $3.05 or 3.37%, amid growing confidence in an imminent peace agreement between the U.S. and Iran. U.S. West Texas Intermediate crude also fell to $84.88, its lowest since April 17, down $2.83 or 3.23%, according to Reuters.
The decline followed reports that a memorandum of understanding to halt the Gulf war could be signed as soon as Sunday, with Geneva as the likely venue. John Kilduff, partner at Again Capital, said the market reacted to Iranian statements about the memorandum. Iranian Foreign Minister Abbas Araqchi clarified on June 12 that no memorandum had yet been signed, according to Reuters.
The anticipated peace deal has eased geopolitical tensions that had supported elevated oil prices earlier this year. Brent crude had been trading above $90 for much of 2026 due to conflict risks in the Gulf region. The potential agreement between the U.S. and Iran marks a significant shift, impacting global oil supply expectations and market sentiment, Reuters reported.
The next key date is the potential signing of the memorandum, expected by June 14, which will be closely watched by oil markets for further price movements and stability in the Gulf region, Reuters noted.