NEW YORK, Sept. 23 -- West Texas Intermediate crude settled below $100 a barrel Monday for the first time in more than a week, as an unexpected diplomatic signal at the United Nations and the fastest recovery in Saudi Arabian oil exports since August combined to strip roughly $5 of war risk premium from a market that had been pricing in a protracted conflict through the Strait of Hormuz.

Brent futures, the international benchmark, fell $2.12 to $101.75 a barrel. WTI declined to $98.34, a 2% drop on the session. Both benchmarks had been anchored above $103 for much of last week, sustained by Iranian threats over the Strait of Hormuz and persistent disruption to shipping through the Bab al-Mandab Strait.

Two developments on Monday changed...