Oil slides after Trump agrees to conditional two-week Iran ceasefire

Oil prices dip following Trump’s conditional Iran ceasefire

President Donald Trump’s announcement of a two-week ceasefire with Iran, contingent on the Islamic Republic allowing unrestricted passage for ships through the vital Strait of Hormuz, triggered a sharp decline in global oil prices. Brent crude dropped 15.5%, trading at $92.80 per barrel, while US crude fell nearly 16.5% to $93.80. Despite this drop, prices remain elevated compared to levels before the conflict began on 28 February.

The energy market has experienced a rise in costs due to disruptions in Middle Eastern oil and gas supplies. These disruptions stem from Iran’s threats to target vessels using the strait, a response to US and Israeli airstrikes. The temporary pause in hostilities has eased some pressure, but the underlying tensions continue to influence market dynamics.

Conditional agreement outlined in Trump’s social media post

“I agree to suspend the bombing and attack of Iran for a period of two weeks… subject to the Islamic Republic of Iran agreeing to the COMPLETE, IMMEDIATE, and SAFE OPENING of the Strait of Hormuz,” Trump stated in a Tuesday evening social media message.

Trump had imposed a deadline of 20:00 EDT (00:00 GMT on Wednesday), warning that “a whole civilisation will die tonight” if an agreement was not reached. The conditional nature of the ceasefire has left markets cautious, balancing optimism with lingering concerns over the strait’s security.