Oil futures declined on Monday as the U.S. prepared to impose additional sanctions on Iran, tempering a recent rally that pushed Brent crude to its highest levels in weeks.
Brent crude futures fell 0.9% to $93.51 a barrel by 19:43 ET, paring gains after the contract surged more than 5% over the prior two weeks. West Texas Intermediate crude slipped 1.1% to $86.08 a barrel. The pullback followed a sharp early-session drop as investors booked profits from the prior advance.
The U.S. Treasury is set to unveil the latest sanctions against Iran at a 14:00 ET press conference, according to a statement from Treasury Secretary Scott Bessent. Bessent described the measures as an "economic D-Day" for Tehran in an opinion piece published by the Financial Times. Iran has warned of retaliatory measures, with Secretary of Iran's National Security Council Mohsen Rezaee stating that "not a single drop of oil will be exported" through the Strait of Hormuz or Persian Gulf if the economic pressure continues.
The Strait of Hormuz, a critical chokepoint for global oil supply, has seen reduced traffic as Iran maintains a de facto blockade in response to U.S. hostilities. The waterway accounted for roughly 20% of the world's oil supply prior to recent disruptions. The conflict has also raised risks of further regional spillover, with Yemen's Iran-backed Houthi Group announcing a naval blockade against Saudi Arabia in the Red Sea.
U.S. President Donald Trump's administration has framed the sanctions as the "strictest round ever" against Iran, escalating economic pressure amid ongoing geopolitical tensions. The measures follow a period of heightened volatility in oil markets, driven by supply concerns and regional instability.
