Oil Falls on Iran Deal Hopes, Supply Return Seen

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Oil prices extended their decline for a second session on May 6, 2026, as optimism around a possible Iran agreement raised expectations of renewed supply flows.

Oil Slides Again as Deal Signals Stir Market Momentum

The prices of oil retreated for a second consecutive day, pressured by rising expectations that constrained supply could return to global markets. Brent crude declined $1.89, or 1.7%, to $107.98 a barrel, while U.S. West Texas Intermediate fell $1.83, or 1.8%, to $100.44. The downturn follows steeper losses in the previous session, reinforcing a cautious shift in sentiment.

Momentum shifted after signals of progress toward a potential agreement involving Iran, which could gradually ease disruptions in a key producing region. A temporary operational pause in the Strait of Hormuz further amplified expectations that stalled shipment may soon resume.

Inventory Declines Underscore Tight Supply Backdrop

Despite the pullback, oil prices remain elevated above $100 per barrel, reflecting ongoing supply tightness. Analysts indicate that even with a deal, restoring flows will likely take time, keeping the market finely balanced.

Meanwhile, U.S. crude inventories fell by 8.1 million barrels in the week ended May 1. Gasoline stocks dropped by 6.1 million barrels, while distillates declined by 4.6 million barrels, signaling continued pressure on supply dynamics.