Brent crude fell below US$90 a barrel, while US stocks rose as markets reacted positively to softer-than-expected sanctions and positive talks between Pakistan and Iran.
Trader Robert Charmak works on the floor of the New York Stock Exchange in New York, Friday, Aug 21, 2026. (Photo: AP/Yuki Iwamura)
26 Aug 2026 05:27AM
NEW YORK: Oil prices fell for a second day on Tuesday (Aug 25) as traders judged the risk of renewed military strikes on Iran to have receded, after the United States instead threatened broader economic sanctions.Although Treasury Secretary Scott Bessent said the White House was declaring an "economic D-Day" against Iran and its trade partners, the US gave no timeline for its new sanctions and did not name any other countries it would punish.The measures were softer than analysts had expected and were accompanied by renewed shuttle diplomacy, with key Pakistani mediators reporting positive talks with Iran's president on Monday.Pakistan Interior Minister Mohsin Naqvi reported "a very positive and productive meeting," saying on X he believes the "momentum will help pave the way for further progress and lasting peace in the region."The news helped calm oil markets, with prices falling more than three per cent and the international benchmark Brent back below US$90 a barrel, following weeks of rising prices caused by deadlock in talks to reopen the Strait of Hormuz. Wall Street stocks finished solidly higher, with the broad-based S&P 500 advancing 0.3 per cent.But FHN Financial's Chris Low warned that markets seemed to be shrugging off the US-Canada trade war, with Canada unveiling counter-tariffs on US goods ranging between 15 and 50 per cent."There may be a mistaken belief that because there were already tariffs in place, that it won't make much difference," Low said. "But that is a mistake because the tariffs imposed over the weekend are much broader and much bigger than the tariffs that were there before."
