Crude oil prices fall over 4% after US-Iran peace deal to open Strait of Hormuz; Brent oil below $85 a barrel
US President Donald Trump also announced that the strategic Strait of Hormuz - a vital maritime chokepoint through which roughly 20% of the world’s crude oil supply transits - would reopen.
Crude oil prices crashed more than 4% on Monday after the United States and Iran announced they had reached a peace agreement to end the war and reopen the Strait of Hormuz.
Brent crude oil price plunged 3.95% to $83.88 a barrel, while the US West Texas Intermediate (WTI) crude declined 4.68% to $80.91. Both contracts tumbled more than 3% on Friday.
The US and Iran will sign a memorandum of understanding in Switzerland on Friday, said the prime minister of Pakistan, whose country has served as a mediator.
“The Deal with the Islamic Republic of Iran is now complete,” US President Donald Trump said on Sunday.
Trump also announced that the strategic Strait of Hormuz - a vital maritime chokepoint through which roughly 20% of the world’s crude oil supply transits - would reopen.
“I hereby fully authorize the toll free opening of the Strait of Hormuz, and, simultaneously herewith, authorize the immediate removal of the United States Naval blockade. Ships of the World, start your engines. Let the oil flow!”
Meanwhile, Iran said that the newly announced agreement with the United States put an “immediate end” to the countries’ war.
Taking to Twitter, Shehbaz Sherif, the Prime Minister of Pakistan, said, “Following intensive talks, we are pleased to announce that the Peace Deal between the United States of America and Islamic Republic of Iran has been REACHED. Both sides have declared the immediate and permanent termination of military operations on all fronts, including in Lebanon.”
He added that the official signing ceremony will be on Friday, 19 June in Switzerland.
“With the agreement now in place, mediators will facilitate a series of meetings this week. These pre-implementation discussions will lay the foundation for the technical talks and the official signing ceremony,” he said.
Experts are of the view that supplies through the maritime chokepoint may somewhat ease, but with refining facilities and gas fields hit during the over three-month-long war, restoring production and supplies to pre-war levels may take considerable time.
“There will be an immediate impact on prices. However, as 10-12 million barrels per day of oil production is out of the supply chain, the shut facilities may not immediately restart. Some facilities have also been damaged, which will prolong normalization. For oil prices to reach the pre-war levels of around $70 per barrel, it would take considerable time,” said Prashant Vashisht, senior vice president and co-group head, corporate ratings, ICRA Ltd.
About the Authors
Ankit Gohel is the Deputy Chief Content Producer at Livemint, specialising in financial markets, macroeconomics, and regulatory developments. With a strong focus on equity markets, primary issuances, and policy-driven market movements, he brings clarity to complex financial developments for investors and market participants. <br><br> With nine years of experience in business and financial journalism, Ankit’s approach is rooted in the belief that market reporting should go beyond headlines — connecting data, policy, and ground realities to deliver actionable insights. His work consistently bridges the gap between institutional analysis and investor understanding. <br><br> Ankit has spent three years at Livemint, where he currently helps drive market coverage, editorial strategy, and high-impact financial stories. Prior to this, he worked with leading business news networks such as CNBC-TV18, ET Now, TickerPlant News Service where he built deep expertise in stock market analysis, macroeconomic trends, primary markets, and coverage of key regulators including the RBI and SEBI. <br><br> Over the years, he has covered market cycles across bull and bear phases, IPO booms, liquidity shocks, and major policy shifts that reshaped investor sentiment. He has interviewed fund managers, corporate leaders, and policymakers, translating their perspectives into sharp, data-backed narratives. Ankit combines speed with accuracy — ensuring timely, credible, and insight-driven financial journalism that empowers both retail and institutional audiences.
Rituraj Baruah is a special correspondent covering energy, housing, urban affairs, heavy industries and small businesses at Mint. He has reported on diverse sectors over the last eight years including, commodities and stocks market, insolvency and real estate; with previous stints at Cogencis Information Services, Indo-Asian News Service (IANS) and Inc42.
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