Image credit: Global Risk Management

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Brent futures dropped for their largest monthly decline in two years after a survey showed OPEC's output hit a 2018 high in July, while comments from U.S. President Donald Trump raised hopes that sanctions on Iranian oil exports could be avoided.

In May, the U.S. pulled out of a multilateral deal that removed sanctions on Iran. On Monday, the President declared that he would be willing to meet Rouhani without preconditions to discuss how to improve their relations. However, Senior Iranian officials on Tuesday rejected this offer as worthless and "a humiliation" after the U.S. pulled out of the deal in the first place and acted to reimpose the sanctions.

Russia and the Organization of the Petroleum Exporting Countries boosted output in July - signs of growing global supply that pressured prices.

For now, the impact of Iran sanctions and strong growth in oil consumption overshadow concerns about the global economic outlook and the impact of high prices on oil demand.