Oil prices fell at Monday’s open after US President Donald Trump said he was highly unlikely to order fresh attacks on Iran while negotiations to end the conflict are making progress.

Brent crude was down 84 cents, or 0.85%, at $97.48 a barrel by 0138 GMT, while West Texas Intermediate fell 32 cents, or 0.35%, to $90.51, the Daily Mirror reported, citing Reuters.

The decline reversed small gains made at Friday’s settlement. It follows a week in which Brent fell 17% — the steepest weekly drop since the start of the COVID pandemic, and the largest in absolute terms in LSEG data going back to 1988.

What Trump said

Trump made the remarks in a 20-minute telephone interview with CNN’s Jim Sciutto, Hiru News reported, repeating the phrase “highly unlikely” five times.

“It depends on whether or not they sign a very strong agreement,” Trump said. “The answer is highly unlikely it’s going to be necessary. I would if necessary, but we hit them really hard.”

He said Iran was “withering away financially” and claimed the country was experiencing 301% inflation — a figure attributed to him and not independently confirmed in the filings.

Trump had hinted at renewing strikes after last week’s US midterm elections, but there has been no sign of a large-scale operation. Iran has said it would respond by striking US and Israeli targets.

Hiru reported that eight months into the war the two sides remain in a stalemate, with Qatar mediating and both governments silent on the state of talks. Washington has meanwhile offered a reward of up to $20 million for information on Iran’s nuclear programme and set up a task force to block the movement of advanced weapons over land routes — steps that point to intensifying rather than easing pressure.

Tim Waterer, chief analyst at KCM Trade, called Trump’s comments “more measured” but said the market was “still waiting to see whether the midterms have produced a lasting shift in Trump’s approach to the conflict, or whether this is just another temporary change in tone.”

Supply is rebuilding

JPMorgan said in a report on Friday that oil is heading for a glut again, estimating a global surplus of 1.1 million barrels per day in September, widening to 1.4 million bpd in October, as Middle Eastern flows recover, other producers raise output and demand stays weak.

Iraq has reached an understanding with the United States to allow its oil exports through the Strait of Hormuz via a shipping lane near Oman, Foreign Minister Fuad Hussein said in an interview with Al Jazeera, reported separately by Hiru News. He put Iraq’s losses from the war and export disruption at $60 billion. Iraqi exports recovered to about 3.5 million bpd in October from 2.65 million bpd in September.

Separately, the Houthis claimed responsibility for an attack on Saudi Aramco’s offices in Riyadh on Sunday that blew out windows but caused no reported casualties.

Why it matters for Sri Lanka

Sri Lanka imports virtually all of its crude and refined fuel, so world prices feed directly into the monthly pricing formula and into the Ceylon Petroleum Corporation’s costs. A sustained fall would ease pressure on a market where the CPC has been supplying private operators under pricing agreements. At close to $97, however, Brent remains far above the levels that prevailed before the conflict.

Not reported

None of the filings gives a forecast range for prices, says when the next round of talks is scheduled, or indicates whether Sri Lanka’s fuel pricing formula will reflect the fall in the next revision.