Oil prices plunged on Friday after Iran’s foreign minister said the Strait of Hormuz was fully open to commercial traffic for the remainder of the 10-day ceasefire between Israel and Lebanon, and President Trump said Iran had agreed to indefinitely suspend its nuclear program.
Futures on Brent crude (BZ=F), the international pricing benchmark, fell 11% to trade below $89 per barrel, while those on US benchmark West Texas Intermediate (WTI) crude (CL=F) fell by 11.1% to trade at $81. Both products opened the week above $100.
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“In line with the ceasefire in Lebanon, the passage for all commercial vessels through Strait of Hormuz is declared completely open for the remaining period of ceasefire,” Iranian foreign minister Abbas Araghchi wrote in a post on X. He added that vessels will be allowed to use the “coordinated route as already announced” by the regime.
Several hours later, President Trump said in an interview with Bloomberg News that Iran has agreed to suspend its nuclear program with no timeline for a restart, and that “most of the main points are finalized” for a deal to end the war.
President Trump added that Iran would not be receiving any frozen funds in return. Axios reported previously that the US is reportedly considering a deal to release $20 billion in frozen Iranian funds in exchange for the regime surrendering its stockpile of enriched uranium.
In comments to Reuters, President Trump said the US would be working with Iran to recover the regime’s uranium stockpile, saying, “We’re going to go in with Iran, at a nice leisurely pace, and go down and start excavating with big machinery.”
Iran has not yet confirmed any of Trump’s points about the regime’s nuclear program.
No date has yet been set for a second round of talks, Pakistan’s foreign minister said Thursday morning. Senior Gulf and European leaders have said in private that they believe a deal could take six months to reach, Bloomberg reported.
The announcement from the Iranian foreign minister Friday morning that the strait would be open comes after Israel and Lebanon agreed to a temporary 10-day ceasefire that began at 5 p.m. ET on Thursday, taking some pressure off one of the key sticking points in negotiations between the US and Iran to end the war in the Middle East.
On Thursday, President Trump announced in a Truth Social post that Israel and Lebanon had reached a 10-day ceasefire agreement, marking a temporary break in a side conflict that has snarled any potential positive movement between the US and Iran and potentially opening the way for second-round talks.
“I just had excellent conversations with the Highly Respected President Joseph Aoun, of Lebanon, and Prime Minister Bibi Netanyahu, of Israel. These two leaders have agreed that in order to achieve PEACE between their countries, they will formally begin a 10 Day CEASEFIRE at 5 P.M. EST,” the president wrote.
Even so, oil market watchers and other experts said sticking points remain for shipowners even with Friday morning’s news.
Iran state TV reported Friday that any vessels looking to make the crossing must coordinate with the Revolutionary Guard Corps, per Bloomberg. It was also not immediately clear which route Iran wanted ship captains to take. Iranian leaders have said previously that ships wanting to traverse the strait must pass close to the Iranian coast, while on Wednesday, the regime offered a deal for safe passage of vessels in Omani waters so long as the US and Iran could agree to a firm ceasefire.
Read more: How oil price shocks ripple through your wallet, from gas to groceries
In a Truth Social post less than an hour after Araghchi’s statement, President Trump said that while the strait is “completely open and ready for business,” the current US naval blockade “will remain in full force and effect as it pertains to Iran, only, until such time as our transaction with Iran is 100% complete” — potentially complicating matters for shipowners looking to make sense of a fast-moving situation.
President Trump then said in a separate post that Iran has “agreed to never close the Strait of Hormuz again,” though that agreement hasn’t been confirmed by Tehran, according to Reuters. Iranian officials told the semi-official news agency Fars that if the US blockade persists, Iran will close the waterway again, Reuters reported.
Jake Conley is a breaking news reporter covering US equities for Yahoo Finance. Follow him on X at @byjakeconley or email him at jake.conley@yahooinc.com.
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