Dollar Slips as Iran Deal Hopes Keep Oil Below $100

May 26, 2026

Mintesinot Nigussie

The US dollar weakened on Tuesday as investors increased bets that diplomatic talks involving Iran could ease tensions around the Strait of Hormuz, helping keep oil prices below 100 US dollars per barrel despite renewed military action in the region.

Market sentiment improved after Iranian officials travelled to Doha for discussions with Qatar’s prime minister over a possible agreement linked to the three-month conflict.

The optimism supported risk-sensitive currencies and reduced pressure on emerging markets that had faced mounting strain from elevated oil prices during the conflict.

Against a basket of major currencies, the dollar index traded at 99.031. Oil markets remained volatile with Brent crude futures rising 1.5 percent to US$97.76 per barrel.

Analysts said that even if negotiations produce a near-term breakthrough, energy prices may remain elevated for some time because global supply chains disrupted during the conflict are unlikely to normalise quickly.