Oil prices fell to settle near $85 a barrel, down from a five-month high as stocks fell, with traders taking stock of diplomatic efforts in the Middle East.
Israel said that progress had been made in negotiations for a ceasefire in Gaza, although Hamas denied this claim.
Meanwhile, a senior commander in the Iranian Revolutionary Guard said that the armed group will not close the Strait of Hormuz amid escalating tensions with Israel. Direct Iranian intervention in the war entails the potential for major disruptions to global crude oil supplies.
Oil's recent decline was also driven by technical factors, as metrics such as the Relative Strength Index (RSI), which signals futures, were in overbought territory.
However, the broader outlook remains bullish, and some market watchers expect the oil price to reach $100 as the OPEC+ alliance continues production cuts.
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