Oil prices dropped Monday as traders waited for details of a new U.S. sanctions package targeting Iran, billed by Washington as its toughest yet. The move is drawing fresh scrutiny to China's Iranian oil imports, which have fallen sharply this year even as Brent trades near $93 a barrel.
West Texas Intermediate futures declined about 2.7% to $84.73 per barrel, while Brent crude lost 2.1% to $92.44 a barrel. Investors were bracing for U.S. Treasury Secretary Scott Bessent to unveil a new sanctions package against Iran later Monday.
Bessent frames the sanctions as historic
Bessent said on X that "the single greatest financial offensive ever marshaled against an adversary" was about to begin, and told CNBC last week that Washington intends to collapse the Islamic Republic with the toughest sanctions in history. The announcement follows President Donald Trump's threat last week to launch the most crushing economic operation ever taken against any country against Iran. Iran pushed back, with the Islamic Revolutionary Guard Corps saying Tehran has ways to counter the pressure and can easily establish economic relations with countries, according to Iranian state media cited by CNBC.
China's Iranian oil imports have already slid
Even before the new measures, Chinese imports of Iranian oil fell from 1.4 million barrels per day in 2025 to 534,000 barrels per day as of August, according to data from Kpler cited by Reuters. Independent Chinese refiners are among the largest buyers of Iranian crude, so a further squeeze on that trade could tighten global supply and demand for oil. Separately, prediction markets currently put the odds of crude oil reaching a new all-time high by September 30 at just 2.5%.
Analysts see a wide price band ahead
Commonwealth Bank of Australia expects oil prices to stay volatile through the rest of the year as markets weigh whether the isolation campaign succeeds and how Iran might respond. The bank expects Brent crude to trade between $70 and $100 a barrel in the second half of 2026, adding that prices could slide toward the bottom of that range if flows through the Strait of Hormuz recover even modestly. CBA estimated that just 50% to 60% of pre-war quantities through the strait would be enough to revive expectations of an oversupplied global market.
Sources: International: Top News And Analysis, Crypto Briefing
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