Crude oil futures settled at $79.26, down $3.35, or 4.06%, on the day. Prices moved in a wide range during the session, touching a high of $82.43 before selling accelerated into the close. The decline pushed WTI to a low of $77.78, where buyers emerged after the market tested the upper end of a key swing area between $77.11 and $77.93.

That support zone remains an important technical barometer for traders watching whether the pullback is just another retracement after a sharp rally or the start of a deeper move lower. A sustained break below it would increase the bearish bias and shift attention to the 200-day moving average at $75.36, which is the next major downside target. On the upside, the day’s high near $82.43 is the first level sellers are likely to defend if prices attempt to recover.

The drop in crude prices was driven mainly by a sharp unwinding of the geopolitical risk premium rather than a sudden shift in supply or demand fundamentals. Several developments contributed to the move:

Middle East tensions eased. The market continued to price out the risk premium after the U.S. paused additional military strikes on Iran, raising hopes that the conflict will not escalate further.

Diplomatic optimism increased. President Trump said the U.S. was having “good” or “deep” talks with Iran, encouraging expectations that negotiations could reduce the risk of further supply disruptions. Iran denied direct talks, but traders focused on the lower likelihood of an immediate military escalation.

Concern over the Strait of Hormuz declined. Oman has reportedly been working with regional countries on proposals to improve shipping through the Strait of Hormuz. Even though traffic remains below normal, the perception that the critical shipping lane is less likely to be disrupted weighed on oil prices.

Profit-taking followed the war-driven rally. WTI had surged above $93 on fears of a prolonged conflict. As those concerns eased, traders locked in gains, accelerating the decline. Analysts noted that much of the selling reflected the removal of the geopolitical premium rather than a deterioration in physical market conditions.

Markets also looked ahead to the possibility that broader easing of geopolitical tensions, including discussions surrounding Russia and Ukraine, could eventually increase global crude exports and add to the bearish tone.

Not all of the latest developments pointed in the same direction. Israeli Prime Minister Netanyahu was in Washington meeting with President Trump. He told Trump that more strikes on Iran’s nuclear facilities were needed because they had been “rehabilitated.”