Oil Prices Drop as US Pursues Diplomacy With Iran

Oil prices declined in Asian trade on November 12, 2026, as the geopolitical risk premium faded amid reports that the United States is seeking renewed diplomacy with Iran. Brent oil futures fell to approximately $91.63 to $92.05 a barrel, while West Texas Intermediate crude dropped to between $85.55 and $85.88 a barrel.

Vice President JD Vance is considering in-person talks with a top Iranian security official, a move supported by President Donald Trump. This diplomatic push follows a Democratic victory in the U.S. midterm elections, which analysts from OCBC suggest may increase the political and fiscal costs of military action, thereby reducing the risk of escalation.

Market uncertainty persists as Iran continues to attack vessels in the Strait of Hormuz and demands the removal of a U.S. naval blockade. Additionally, fighting continues between Saudi Arabia and Iran-backed Houthi rebels, and U.S. industry oil inventories unexpectedly increased by 9 million barrels.

Despite the current dip, OCBC maintains a year-end 2026 Brent forecast of $100 a barrel. The institution cites scarce vessel capacity, longer shipping routes, and continued tanker attacks as factors that will keep delivered crude costs high.