Oil prices slip as Vance letter to Iran raises hopes for peace talks

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December Brent crude futures fell 1.2% to $113.91 a barrel as traders weighed peace efforts against the risk of renewed military action

EVAN VUCCI / Getty Images

Vice President JD Vance wrote to Mohsen Rezaei, who serves as secretary of Iran’s Supreme National Security Council, in an effort to revive peace talks, according to The Wall Street Journal. Oil prices slipped Thursday as investors balanced the diplomatic push against threats to Middle East supplies.

The December Brent contract slid 1.2%, to $113.91 per barrel. The December West Texas Intermediate contract lost 1.4%, to $101.34 per barrel.

On Wednesday, President Donald Trump said he had given his blessing to Vance's effort to reach out. According to The Wall Street Journal, the discussions have been aimed at outlining a possible structure for talks, not at presenting a fully developed peace plan.

Several Gulf Arab countries have been told by the U.S. to get ready for a potential brief but intense military campaign against Iran following the Nov. 3 midterm elections, according to The Wall Street Journal. Trump has yet to make a conclusive call on whether to resume strikes.

Mediators from Qatar offered a new plan to end the fighting among Iran, the U.S. and Israel, according to CNBC. A high-ranking Iranian official dismissed the offer, calling it unacceptable, according to CNBC. Iran’s foreign minister wrote on X $TWTR that Tehran was still willing to pursue diplomacy and could fast-track a proposed seven-day peace plan should a deal be struck.

Regional security threats continued. Early Thursday, the Saudi-led military coalition reported that its air defenses had shot down yet another ballistic missile fired by Yemen's Houthi militants at Saudi Arabia's Eastern Province, according to The Wall Street Journal.

The Houthis said they struck Saudi Arabia's Ras Tanura refinery with a ballistic missile earlier this week, and oil prices rose on Wednesday. Saudi authorities have not confirmed the claimed strike, nor have they confirmed any harm at the site.

Oil prices had climbed through October as attacks on commercial ships in the Strait of Hormuz escalated. The U.S. and Iran signed a memorandum of understanding on June 17, but the agreement collapsed.

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