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Fuel tankers carrying Iraqi oil arrive at the coastal storage facilities of the Baniyas Oil Terminal in Tartus province, Syria, on September 13, 2026.
Hasan Belal | Anadolu | Getty Images
Oil prices reversed early gains on Tuesday amid optimism that prospects for a diplomatic solution to the U.S.-Iran war are improving ahead of closely watched United Nations General Assembly talks in New York.
Concerns of growing Iran-U.S. tensions had initially lifted oil prices after U.S. Treasury Secretary Scott Bessent told CNBC that all Iranian airlines will be shut down from Wednesday.
However, oil prices swung lower after a report from Japanese news wire Kyodo, which claimed Iran had offered to reopen the strategically crucial Strait of Hormuz within seven days. The report, later corroborated by Reuters, cited a single source and could not be independently verified by CNBC.
Futures for international benchmark Brent crude for November delivery were down 2.75% at $97.58 a barrel as of 6:12 a.m. ET. U.S. West Texas Intermediate futures for October plunged 3.53% to $92.40 per barrel, easing from a session high of $97.42.
Brent
Bessent told CNBC that all Iranian airlines will be shut down from Wednesday. "How do we do that? That if they land, you cannot provide them with fuel. You cannot provide them with landing services, you cannot sell them tickets, or you will be knocked out of the dollar system," Bessent said on CNBC's "Squawk Box."
Investors are still eyeing a possible diplomatic solution to the Mideast conflict, following news that Iranian president Masoud Pezeshkian is set to fly to the United Nations in New York.
Pezeshkian will address the assembly and present Iran's positions on "international developments," with a particular focus on its war with the U.S. and Israel, according to the country's semi-official Tasnim news agency. Talks with the leaders of several countries are also scheduled to take place Sept. 22 to 26, and 28, on the sidelines of the event.
WTI
Attention will likely remain focused on diplomatic developments, said Lukman Otunuga, head of market research at online brokerage FXTM.
"Confirmation of direct talks between Washington and Tehran could place additional selling pressure on prices by improving expectations for regional supply," Otunuga said.
"Conversely, Tehran has warned that renewed escalation would trigger a significant response, which could push crude prices higher," he added.
—CNBC's Anniek Bao contributed to the report.
