Why did oil prices drop more than 7% at the open, according to the news?

Oil prices dropped more than 7% at the open because President Donald Trump announced that fresh US-Iran talks would begin Monday, leading to optimism that a deal could reopen the Strait of Hormuz; he also revealed he had agreed to call off a massive military attack on Iran after urging from Middle East allies including Saudi Arabia, and the drop was further amplified by another small increase in production quotas by major OPEC+ nations.

What market impact did Trump’s comments about US-Iran talks and the canceled attack have on US equity futures and the dollar?

Trump’s comments boosted optimism about de-escalation, causing S&P 500 futures to rise 0.4% as of 7:01 a.m. Tokyo time and the US dollar to slip, with the risk-sensitive Australian dollar rising 0.3% to $0.7043 and the Japanese yen edging higher by 0.2% to 157.02 per dollar, while the euro rose 0.2% to $1.1553 — all reflecting reduced geopolitical risk sentiment and increased appetite for risk assets.

Oil Slumps, US Futures Rise on Iran Talks Optimism: Markets Wrap

Aug 2, 2026

Oil prices dropped over 6% following President Trump's announcement of US-Iran talks to reopen the Strait of Hormuz, easing supply concerns and lifting global markets.

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