Oil prices fell sharply on Wednesday after U.S. Secretary of State Marco Rubio said the U.S. would give talks with Iran “every chance to succeed.”
WTI crude dropped more than 5% to close at $88.68 a barrel, while Brent also fell more than 5% to settle at $94.29.
“The bottom line is that we prefer the negotiated diplomatic route and we’re going to give it every chance to succeed,” Rubio said.
That was enough for oil traders to hit sell. But the scale of the move raises a question: is the oil market overreacting to any hint of diplomacy? The comment did not confirm a deal. It did not remove the risk of escalation. It simply suggested the U.S. still prefers a negotiated route.
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