Oil Prices Fall to Three-Month Low After U.S.-Iran Breakthrough

Global oil prices fell sharply on Monday after the United States and Iran announced a preliminary agreement aimed at ending months of conflict and reopening the Strait of Hormuz, easing concerns over disruptions to energy supplies from the Middle East. Brent crude dropped by more than $4 to $83.30 per barrel, while U.S. West Texas Intermediate (WTI) crude fell more than 5% to $80.60 per barrel. Both benchmarks had already posted losses of more than 3% at the end of last week. The decline followed announcements by U.S. President Donald Trump and Iranian Deputy Foreign Minister Kazem Gharibabadi that Washington and Tehran had reached an initial agreement to halt hostilities and restore maritime traffic through the Strait of Hormuz. Pakistani Prime Minister Shehbaz Sharif said the two sides are expected to sign a memorandum of understanding in Switzerland on Friday. Pakistan has played a mediating role in negotiations between the United States and Iran. Trump said the Strait of Hormuz would reopen without transit fees for commercial vessels and that the U.S. naval blockade of Iranian ports would be lifted. Reports on the draft agreement indicate that the strategic waterway could reopen gradually within 30 days. Market analysts said the agreement has reduced fears of prolonged supply disruptions that had pushed oil prices higher in recent months. Investors are now closely monitoring the recovery of regional oil exports and shipping activity through key Gulf trade routes. The U.S.-Iran agreement has been welcomed by governments and international organizations as a major diplomatic breakthrough after months of conflict that disrupted regional trade and heightened concerns about global energy security. The framework includes a ceasefire, the reopening of the Strait of Hormuz and further negotiations on sanctions relief and Iran’s nuclear programme. Reuters reported that the agreement establishes a 60-day negotiation period during which both sides will seek a broader settlement on unresolved issues, including sanctions, regional security arrangements and nuclear-related concerns. A formal signing ceremony is expected to take place in Switzerland later this week. The Strait of Hormuz is one of the world’s most important energy corridors, carrying roughly one-fifth of global oil trade and significant volumes of liquefied natural gas exports. The disruption of shipping through the waterway over recent months raised concerns among energy-importing countries and contributed to volatility in international markets. The post Oil Prices Fall to Three-Month Low After U.S.-Iran Breakthrough appeared first on Khaama Press.