Global oil prices fell sharply as uncertainty surrounding a potential agreement between Washington and Tehran heightened concerns about the economic impact of continued disruptions to shipping through the Strait of Hormuz.

Global crude benchmark Brent fell as much as 5.2% to $98.12 a barrel, while West Texas Intermediate was near $92.

The strait – which links the region to world markets – has been subject to a double blockade, with curbs imposed by both Iran and the US.

Crude oil prices plunged over 4% as optimism over a possible US-Iran deal and reopening of the Strait of Hormuz eased supply concerns.