Oil prices dropped by more than one percent after US President Donald Trump said he had paused a planned attack on Iran to allow negotiations aimed at ending the US-Israeli war on Iran.
Brent crude futures fell to just above $110 a barrel following the remarks, while US oil futures dropped to $103 a barrel.
Markets are closely watching talks between Washington and Tehran amid concerns over the continued closure of the Strait of Hormuz.
Before the disruption, the waterway handled roughly one-fifth of global oil and liquefied natural gas supplies each day.
