Oil Prices Plunge 20% in May, Biggest Monthly Drop Since 2020; Traders Eye Iran Deal Impact
Global oil prices fell more than 20% in May, recording their steepest monthly decline since 2020, driven by market expectations of a potential peace agreement between the United States and Iran.
Supply Disruption Risk Recedes
The sharp sell-off reflected growing confidence among traders that a U.S.-Iran deal could remove a key geopolitical risk premium from crude markets. Analysts noted that an accord would likely ease sanctions on Iranian oil exports, potentially adding significant supply to an already well-supplied global market. The price drop accelerated throughout the month as diplomatic signals from both Washington and Tehran pointed toward progress in negotiations.
Monthly Performance in Historical Context
May’s 20% decline marks the largest monthly percentage loss for crude futures since the collapse in demand during the early stages of the COVID-19 pandemic in 2020. The slump erased gains accumulated earlier this year, with benchmark prices now hovering near $72 per barrel as of May 29, 2026.
Market Context
As of May 29, 2026, key financial indicators include:
- Russian ruble exchange rate: 71.02 per U.S. dollar (change: -0.35), 82.64 per euro (change: -1.05)
- Bitcoin price: $73,450 (24-hour change: +0.1%)
- Crude oil: approximately $72 per barrel (estimated)