Oil reversed lower in light of two reports that gave tentative signs of diplomatic efforts to unblock the Strait of Hormuz. Brent fell below $99 per barrel after Japan's Kyodo news agency, citing an unnamed senior Iranian official, reported that Tehran had offered to open the Strait within seven days if the US blockade were lifted — as a basis for talks with mediating countries on the sidelines of the UN. Iran's Islamic Revolutionary Guard Corps also said it would be willing to negotiate if doing so served national interests.

The timing added weight to the news: US President Donald Trump is expected to speak at the UN General Assembly in New York later on Tuesday and could meet his Iranian counterpart Masoud Pezeshkian on the sidelines. The coincidence of Iran's diplomatic initiative with a possible leaders' meeting was the main trigger for the oil selloff, since the market often reacts less to the fact of talks than to the likelihood they will succeed.

Optimism should be treated cautiously. Attempts to end the war that has rattled energy markets for more than six months have been made repeatedly — including a short summer truce — and have so far produced no lasting result. Since then the US has blocked Iranian ports, cutting vital export revenues, and Iran has responded by attacking ships in the Strait of Hormuz. Although flows through the strait remain measured in millions of barrels per day, they are still below pre?war levels.

Since the start of the year, oil has rallied more than 60% as the Middle East conflict disrupted shipments through the world's most important energy chokepoint, and fuel prices have risen even more sharply. However, even a partial de?escalation around Hormuz would not remove all pressure from the market, because the fuel deficit is not caused solely by Iran but also by the separate Russia?Ukraine front.

Another factor remains the fate of Saudi Arabia's East?West pipeline, idled after a shutdown earlier this month: the kingdom has already told Asian refiners it will soon be able to resume shipments via the Red Sea port of Yanbu. For now, Saudi Arabia appears to have re?directed exports back through the Persian Gulf via Hormuz.

In my view, as long as Iran's offer remains an unconfirmed third?party report rather than an official Tehran statement, the market will trade the news cautiously. I would not rule out a quick rebound of Brent to $100–102 if a Trump?Pezeshkian meeting at the UN yields no concrete agreements. A far more durable factor for prices in the coming days would be the actual reopening of the Saudi East?West pipeline, which could add significant supply regardless of the Hormuz talks' outcome.

On the technical side, buyers need to take the nearest resistance at $96. That would allow a run toward $100, above which further advances would become considerably more difficult. The next extended target is around $104. On the downside, bears will try to seize control of $92; if they succeed, a breakdown of that range would seriously damage bull positions and push oil toward a low of $89 with a prospect of reaching $87.