Oil prices fell about 5 per cent on Monday after President Donald Trump said he had called off a planned strike on Iran, with traders unwinding some of the risk premium built up during two weeks of attacks around the Strait of Hormuz.
CNBC reported West Texas Intermediate futures for September delivery down 5.05 per cent at $80.39 a barrel in Asian trading, with Brent for October delivery off 4 per cent at $84.41.
What moved the market?
Trump wrote on social media that Iran and other Middle Eastern countries had asked him to hold off on an attack because the outline of a deal had been agreed. He said negotiations would begin on Monday.
Iran’s Foreign Ministry contradicted that account later the same day, saying it was talking only to Oman and that the strait remained closed. The gap between the two positions leaves the central question for oil traders unresolved: whether the waterway, which carries a large share of seaborne crude, reopens or stays shut.
| Benchmark | Move | Level |
|---|---|---|
| WTI (September) | -5.05% | $80.39 |
| Brent (October) | -4.00% | $84.41 |
| Dow futures | +0.39% | 52,839 |
| S&P 500 futures | +0.43% | 7,551 |
| Dollar index | -0.30% | 99.50 |
Why did oil prices fall on 3 August 2026?
Oil prices fell by roughly 5 per cent on Monday 3 August 2026 after US President Donald Trump said he had called off a planned military strike on Iran and that negotiations would begin the same day. West Texas Intermediate futures for September delivery declined 5.05 per cent to $80.39 a barrel and Brent crude for October delivery fell 4 per cent to $84.41, according to CNBC. The moves reflected traders reducing the geopolitical risk premium priced into crude during two weeks of exchanges between the United States and Iran centred on the Strait of Hormuz. US equity index futures rose modestly, with Dow futures up 0.39 per cent. The rally was not shared across Asia, where South Korean and Japanese equities fell sharply on separate concerns over semiconductor valuations and currency intervention.
How did other assets respond?
US equity futures rose. Dow futures gained 204 points, or 0.39 per cent, to 52,839, while S&P 500 futures added 0.43 per cent and Nasdaq 100 futures 0.64 per cent. Natural gas rose 0.58 per cent. The dollar index slipped 0.30 per cent to 99.50.
The Associated Press reported the lull in fighting helped push crude down about 5 per cent, with US benchmark crude at $80.58 early Monday.
The declines follow a volatile stretch. Brent traded above $100 within the past fortnight during the heaviest phase of the exchanges, and last week marked a third consecutive weekly gain before Monday’s reversal.
What would reopening actually require?
Iran has framed the arrangement under discussion with Oman as a temporary route rather than a reopening of the strait. US Central Command said it had redirected 35 commercial vessels, disabled two and boarded two during its blockade of Iranian ports as of 2 August.
The physical crude market remains tight regardless of the diplomatic position, which limits how far prices can fall while the waterway stays shut. Traders are pricing the prospect of a deal rather than any change on the water.
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Sources for this report
The Redline News Desk
The Redline News desk files and edits world reporting. Every story carries the sources it was built from, and corrections are published on the story itself.
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