FX.co ★ Oil Prices Slide as US Expands Sanctions on Iran

Crude oil extended its decline on Monday, slipping below $85 a barrel after US Treasury Secretary Scott Bessent outlined plans to further isolate Iran with sanctions aimed at entities and individuals doing business with the country. Although the measures are wide-ranging, market participants are primarily focused on how they might affect Iran’s oil exports and whether they will hasten or hinder any resolution to the US-Iran standoff. Bessent cautioned that at least one major financial institution could be sanctioned this week and indicated that China would not be exempt from potential actions. Iran, which has previously shown an ability to evade sanctions, has warned other nations against backing Washington’s strategy. Despite the heightened geopolitical tensions, crude continues to transit the Strait of Hormuz, with export volumes holding up relatively well. Reports suggest roughly 16 million barrels passed through the strategic chokepoint in a single night last week, though daily flows can fluctuate sharply.