Brent crude for January delivery fell 1.1% to $103.62 a barrel, while West Texas Intermediate for December slid 0.5% to $96.03. The price shift followed reports of U.S. strikes on Qeshm Island in the Strait of Hormuz. Samer Hasn, a senior market analyst at XS.com, noted that traders appear to be downplaying the immediate impact of these strikes, viewing them as non-escalatory within a market already braced for conflict.

Contradictory signals remain. While President Trump recently suggested on Truth Social that a settlement with Iran could be imminent, skepticism persists among analysts. Robert Yawger of Mizuho Securities USA characterized the diplomatic messaging as a strategic effort to project stability during the U.S. midterm elections. Meanwhile, physical risks endure: the U.K. Maritime Trade Operations reported two vessels were struck by unidentified projectiles near Saudi Arabia and Oman on Monday.

Supply chain concerns underscore the volatility. Saudi Aramco CEO Amin H. Nasser confirmed that oil shipments through the Strait of Hormuz are still trailing pre-conflict volumes. He warned that current shipping data may be misleading due to double-counting at transfer points, noting that vessels continue to face significant delays seeking safe passage. Despite Iranian President Masoud Pezeshkian signaling a readiness for dialogue, ANZ analysts maintain that the lack of a concrete agreement on reopening the Strait leaves the market vulnerable to sudden shifts.