Global oil benchmarks suffered their sharpest single-day slide in weeks on Monday, shedding more than $4 a barrel after US President Donald Trump signaled a temporary halt to military action against Iran in favor of diplomatic talks. The move, announced late Saturday, centers on a proposed agreement to fully reopen the Strait of Hormuz — a waterway critical to roughly a fifth of the world's petroleum shipments. Main Developments Brent crude futures dropped $4.49, or 5.11 per cent, to $83.44 per barrel by 0408 GMT, while US West Texas Intermediate crude fell $4.90, or 5.79 per cent, to $79.77. The decline erased a portion of the more than 20 per cent surge both contracts recorded last month, driven by renewed US-Iran hostilities and a series of attacks on tankers near Oman. Trump, writing on his Truth Social platform, stated that Iran and other Middle Eastern nations had requested additional time to finalize a deal that would ensure the "Immediate, Complete and Total" reopening of the strait and put an end to Iran's nuclear threat. Market analysts remain cautious, with IG's Tony Sycamore warning that the week could repeat last week's pattern, where hopes for a deal collapsed as Iran maintained its leverage over the waterway, potentially through strikes on US bases or transiting tankers. Read also: 3 Key Flaws in Rs332bn Grid Revenue Approval Background The Strait of Hormuz has been a flashpoint for weeks, with fighting between the US and Iran escalating after a period of relative calm. Attacks on several tankers around Oman had heightened security concerns, discouraging shippers from entering the Gulf to load crude. Over the weekend, two tankers carrying Saudi oil successfully crossed the Bab el-Mandeb Strait out of the Red Sea, while traffic through Hormuz slowed following reports of vessel incidents. Adding to the complex picture, the United Kingdom Maritime Trade Operations has reported three additional tanker attacks since Saturday. Meanwhile, Opec+ on Sunday approved a production quota increase of approximately 188,000 barrels per day starting in September, a move that completes the unwinding of a layer of voluntary output cuts. However, due to export disruptions from the Gulf, Russia, and Kazakhstan — stemming from the Iran and Ukraine conflicts — successive monthly hikes this year have largely remained on paper, with minimal real-world impact on supply. Why It Matters The outcome of these negotiations carries immediate consequences for global energy prices, inflation, and shipping security. A successful deal could stabilize oil markets and ease fears of supply disruptions, while a breakdown risks another spike in crude prices and further attacks on commercial vessels. For consumers, the volatility translates directly into fuel costs, and for shippers, the safety of key maritime routes remains uncertain. What's Next Attention now turns to whether Iran and its regional partners will engage seriously in talks, and whether Trump's pause on military action holds. The coming days will likely reveal if the diplomatic window remains open or if hostilities resume, with traders closely monitoring any new vessel attacks or statements from Tehran. The Opec+ quota increase, though symbolic for now, could gain significance if export routes reopen.