Oil prices drop sharply as Iran-U.S. deal talks progress, easing Middle East tensions and boosting supply outlook.

Recent talks between the U.S. and Iran have led to a framework agreement that is easing fears of conflict in the Middle East, causing oil prices to fall rapidly by about 30% from April highs. Key factors include potential sanctions relief on Iran, faster oil production ramp-up by Gulf states, and increased shipping through the Strait of Hormuz. While optimism grows with falling gasoline prices expected soon, risks remain if the deal collapses or conflict resumes. Analysts from Goldman Sachs and Citigroup highlight increased supply and lower demand, especially from China, as reasons for the price drop, but caution that geopolitical uncertainties could still impact markets.