Oil Prices Plummet 15% Following U.S.-Iran Two-Week Ceasefire Agreement

TLDR

• Brent crude declined by 13% to approximately $94 per barrel; WTI fell 15% to around $96 per barrel
• The United States and Iran reached a two-week ceasefire agreement on Tuesday night
• Trump stated that the U.S. will assist in easing shipping traffic through the Strait of Hormuz
• Iran’s Foreign Minister confirmed Iran will permit safe passage for vessels through the strait
• The Strait of Hormuz carries roughly 20% of global oil flows

(SeaPRwire) –   Oil prices plummeted on Wednesday following the U.S. and Iran’s two-week ceasefire deal, alleviating concerns about major disruptions to the global oil supply.

Brent crude dropped around 13% to $94.77 a barrel. West Texas Intermediate fell roughly 15% to $96.23 a barrel. Both benchmarks hit intraday lows below $92 a barrel in early trading.

The agreement was finalized on Tuesday evening, just before President Trump’s self-imposed 8:00 p.m. Eastern deadline. In the days leading up to the deadline, oil prices had surged to multi-month highs as markets feared a full escalation of the conflict.

Trump had warned that failure to comply could lead to severe consequences. He described the potential fallout as a scenario where “a whole civilization could die.”

The Ceasefire Deal

Trump announced the suspension of military action in a post on Truth Social. He noted that the U.S. had already met its core military objectives and that Iran had put forward a multi-point proposal that could form the basis of a broader agreement.

Trump Halts Iran Strikes for Two Weeks Amid Ceasefire Push

U.S. President Donald Trump said on Truth Social that, following discussions with Pakistani Prime Minister Shehbaz Sharif and Field Marshal Asim Munir, and conditional upon Iran’s agreement to the immediate, full, and… pic.twitter.com/npInV48tUR

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Iran’s Foreign Minister Seyed Abbas Araghchi confirmed the country’s Supreme National Security Council agreed to halt attacks. He stated that ships would be allowed “safe passage” through the Strait of Hormuz, provided hostilities stopped and vessels coordinated with Iranian authorities.

Pakistan played a key role as a mediator, helping push both sides toward a deal in the final hours before the deadline.

Trump described the ceasefire as a “double-sided pause.” He said it is conditional on Iran ensuring the immediate reopening of the strait.

Hormuz Back Open

The Strait of Hormuz had been effectively closed for weeks during the conflict. It handles around 20% of global oil flows, making it one of the most critical shipping routes in the world.

Trump posted on social media Wednesday morning that the U.S. would be “helping with the traffic buildup” through the strait. He wrote: “There will be lots of positive action! Big money will be made. Iran can start the reconstruction process.”

The reopening of the strait is the main reason markets reacted so sharply. With the route blocked, supply fears had pushed prices higher. The ceasefire removed that concern, at least in the short term.

The ceasefire is set to last two weeks. Iran confirmed it will allow safe passage during that period, provided the terms of the deal are upheld.