Brent crude retreated to around $83 on renewed hopes of a peace deal.
US President Donald Trump said that new negotiations with Iran will begin Monday after he decided to hold off on striking the Islamic republic to pursue a deal to end the war entering its sixth month.
Trump told reporters on Sunday that the talks would cover the Strait of Hormuz –- a route for global energy supplies that has become a key sticking point in the conflict -- and ultimately, the denuclearization of Iran.
For its part, Iran said it was nearing a deal with Oman over a new route through the strait, where a tanker reported an explosion nearby on Sunday, underscoring the continued volatility of the strategic waterway.
Oil prices fell on Monday at the opening of Asian trade after Trump announced the new negotiations. On Sunday evening, the price of a barrel of Brent North Sea, the benchmark international oil contract, for September delivery was down 4.69 percent at $83.81.
