Shell, BP and US giants slide as oil prices retreat on reports of US-Iran deal progress
Published: 08:20 06 May 2026 EDT
BP PLC (LSE:BP.) and Shell PLC (LSE:SHEL, NYSE:SHEL) shares fell as oil prices dropped sharply on hopes of easing tensions in the Middle East.
The oil majors were among only eight FTSE 100 fallers on a strong day for equities, with BP down 3.6% and Shell slipping 3.2% in early afternoon trading.
US energy companies fell in premarket trading, with Chevron Corporation (NYSE:CVX) and Exxon Mobil Corp (NYSE:XOM) both down 3.8%, while ConocoPhillips (NYSE:COP, XETRA:YCP) dived 4.6%.
The declines came as Brent crude oil prices fell almost 9% to just above $100 a barrel, its lowest level in two weeks, as investors priced in the possibility of a diplomatic breakthrough between the US and Iran.
US officials believe, according to an Axios report, that they are close to "a one-page memorandum of understanding to end the war and set a framework for more detailed nuclear negotiations".
Both sides expected to respond on key points within 48 hours. While no deal has been finalised, it was described as the closest progress since the war began.
The proposed framework would include a pause on Iran’s nuclear enrichment, phased sanctions relief from the US and a gradual reopening of the Strait of Hormuz, a key route for global oil and gas shipments.
The prospect of improved supply has weighed on crude prices, hitting energy stocks even as broader markets rallied.
Overnight, President Trump said he was pausing this week's effort to move ships through the Strait of Hormuz to allow talks with Iran.
Oil prices and government bond yields fell overnight after Trump announced on social media, which he said was based on the request of Pakistan and other countries and followed "great progress has been made toward a complete and final agreement with representatives of Iran."
He said, 'Project Freeedom' would be "paused for a short period of time to see whether or not the Agreement can be finalized and signed".
The FTSE 100 was up 2.3%, with strong gains across travel, industrial and mining stocks, while continental markets also moved sharply higher.
Analysts said a deal would remove a major source of uncertainty for markets, particularly for European economies more exposed to energy supply risks.
However, no agreement has yet been reached, and uncertainty remains over whether negotiations will deliver a lasting resolution.
