Global oil prices dropped nearly six percent as investors monitored ongoing negotiations between the United States and Iran aimed at ending the conflict between the two countries.

Brent Crude futures fell to around $105 a barrel, while US oil futures settled near $98 a barrel as traders reacted to signs of possible diplomatic progress.

US President Donald Trump said talks with Iran were in the “final stages” but warned that stronger military action could follow if Tehran refused a peace agreement.

Despite the decline in prices, investors remain cautious because of continued concerns over global energy supplies.

Iran continues to maintain control over shipping traffic through the Strait of Hormuz, one of the world’s most important oil transit routes.

According to Al Jazeera, market analysts say uncertainty surrounding the negotiations and fears over possible supply shortages continue to create volatility in energy markets.

The latest price drop follows weeks of sharp swings in crude markets driven by concerns over the wider economic and geopolitical impact of tensions in the Middle East.