Global oil prices witnessed a sharp decline on Monday after reports suggested that chances of a possible agreement between Iran and the United States had improved, raising hopes of reduced tensions in the Middle East.

According to international media reports, crude oil prices fell by more than 5 percent during early trading in Asian markets. Investors reacted strongly to expectations that a diplomatic breakthrough between Tehran and Washington could help stabilize the region and improve oil supply conditions.

Brent crude, the international benchmark for oil prices, dropped by 5.1 percent and reached $98.22 per barrel. Meanwhile, US West Texas Intermediate (WTI) crude also saw a major fall of 5.2 percent, settling at $91.57 per barrel during initial trading hours.

Market analysts said the sudden decline reflected growing confidence among traders that a deal could eventually reduce geopolitical risks that have kept energy markets under pressure for months. Any easing in tensions is expected to increase global oil supply and lower fears of disruptions in the region.

However, uncertainty still remains over the timing and success of any final agreement. Former US President Donald Trump indicated that an immediate breakthrough may not happen soon.

In a statement shared on social media on Sunday, Trump said he had instructed his representatives not to rush into any agreement. His remarks created mixed reactions in financial markets, although overall sentiment remained positive regarding future negotiations between the two countries.