Global oil prices dropped on Friday after Iran sent a fresh peace proposal to the United States through Pakistani mediators. This move raised hopes for an end to the ongoing conflict that began in late February 2026.
West Texas Intermediate (WTI) crude fell nearly 3% and settled around $101-102 per barrel, while Brent crude dropped about 2% to roughly $108 per barrel. Prices had spiked earlier amid fears of war, with Brent briefly exceeding $120. Analysts say traders are now taking profits as diplomatic talks continue.
The proposal aims to end the war, reopen the Strait of Hormuz, and ease the US naval blockade. The Strait is a vital route for about one-fifth of the world’s oil supply. Both sides have blocked shipping there, causing major disruptions and higher energy prices worldwide. Iran has kept the Strait mostly closed, while the US has blocked Iranian oil exports.
However, US President Donald Trump said he was “not satisfied” with Iran’s offer. He noted that Iran wants a deal but added that more work is needed. Despite this, the news brought some calm to markets.
Experts warn that prices could stay high if talks fail and disruptions continue. A real peace deal could bring oil below $100 soon and help the global economy by lowering fuel costs. For now, traders are watching closely for any progress or setbacks in the negotiations.
