Deutsche Bank reports that Brent Oil fell to a two‑month low as headlines suggested progress toward a diplomatic resolution involving the US and Iran. Comments from US officials and Gulf allies reduced fears of renewed escalation. The bank notes that lower Oil prices eased stagflation concerns and supported a more positive growth and inflation outlook for markets.

Diplomatic signals pressure crude

“There was growing optimism on the geopolitical front, as hopes for diplomatic progress between the US and Iran pushed Brent crude (-5.85%) to a 2-month low of $92.57/bbl.”

“Whilst tech stocks were bouncing back sharply yesterday, the other positive catalyst was the latest decline in oil prices, which followed several headlines that raised hopes about a diplomatic resolution.”

“For instance, a Qatari official told Bloomberg that both the US and Iran were talking with mediators on the details of a deal.”

“Late in the US session yesterday, Trump also posted that there was “positive momentum toward an end to this Conflict” and suggested that Gulf allies “prefer the status quo”, even as the US was “locked and loaded” if developments in the region change.”

“So that led to optimism that renewed escalation would be avoided, with Brent crude (-5.85%) ending the session at a 2-month low of $92.57/bbl and down another -1.21% this morning to $91.45/bbl.”