U.S. Oil Extends Losses as Washington Signals Possible Iran Sanctions Relief

Oil Prices Fall on Prospects of Additional Iranian Supply

Brent crude, the international benchmark, fell 1.62% to $106.89 per barrel, while U.S. oil prices slid 1.89% to $94.32 per barrel as of 1:49 a.m. ET. The declines followed remarks from Treasury Secretary Scott Bessent that Washington is considering allowing Iranian crude currently under sanctions to enter global markets.

“In the coming days, we may unsanction the Iranian oil that's on the water, about 140 million barrels,” Bessent told Fox Business Network. He said that reintroducing this sanctioned Iranian crude to the market would help cap prices over the next 10 to 14 days.

The move is being discussed in response to Iran's closure of the Strait of Hormuz, a key oil transit chokepoint. The closure has contributed to heightened concerns over supply disruptions and upward pressure on crude prices.

Geopolitical Context and Diverging Price Scenarios

Israeli Prime Minister Benjamin Netanyahu said Israel is assisting U.S. efforts to reopen the Strait of Hormuz. He also stated that Iran no longer has the capability to enrich uranium or produce ballistic missiles and suggested that the war could end sooner than many expect.

The conflict involving Iran has driven a sharp rally across oil and related commodities, according to Citi. In response, the bank has raised its near-term oil price outlook, now expecting Brent and WTI to climb to $120 per barrel over the next one to three months. Citi’s bull-case scenario sees prices potentially reaching $150 per barrel if disruptions intensify.

However, Citi’s base case assumes de-escalation within four to six weeks. Under that scenario, Brent prices could ease back to a range of $70–$80 per barrel by year-end.

Saudi oil officials, by contrast, anticipate a more severe price impact if disruptions persist. According to a report in the Wall Street Journal, these officials expect crude prices could climb above $180 per barrel if Iran war-related disruptions last through late April.

FAQ

Why did U.S. oil prices decline on Friday?
U.S. oil prices fell after Treasury Secretary Scott Bessent indicated the United States may lift sanctions on about 140 million barrels of Iranian crude stored on tankers, raising the prospect of additional supply entering the market.

What price levels did Brent and U.S. crude reach?
Brent crude dropped 1.62% to $106.89 per barrel, while U.S. oil prices declined 1.89% to $94.32 per barrel as of 1:49 a.m. ET.

What are Citi’s forecasts for oil prices?
Citi now expects Brent and WTI to rise to $120 per barrel over the next one to three months, with a bull-case scenario of $150 per barrel if disruptions worsen. Its base case, assuming de-escalation within four to six weeks, sees Brent easing to $70–$80 per barrel by year-end.

How high do Saudi oil officials think prices could go?
Saudi oil officials expect crude prices could rise above $180 per barrel if war-related disruptions linked to Iran continue through late April, according to the Wall Street Journal.