Oil prices fall sharply after Trump announces Iran deal and Hormuz reopening

Crude oil futures fell around 4% on Sunday after President Donald Trump posted that a deal to end the conflict with Iran was "complete" and that the Strait of Hormuz would be reopened. The decline continued a slide that began earlier in the week, with Brent crude slipping below $84 a barrel and U.S. West Texas Intermediate under $81.

Trump’s post said he was authorising a toll-free opening of the strait and urged ships to "start your engines," adding that the reopening would occur "upon the signing of the Deal on Friday, for purposes of mine removal."

The Strait of Hormuz carries roughly 20% of global oil and liquefied natural gas shipments, and its closure has been a major factor in the price surge since the conflict began. Analysts note that while the reopening could ease supply pressures for consumers in Asia and Europe, it will not instantly restore pre-war flow levels.

"It could be months before things return to something like the way things were before the war, at least as far as flows out of the Strait of Hormuz go," said Kevin Book, managing director at Clearview Energy Partners. He added that some offshore facilities can resume quickly, while others may take months, and that refilling depleted strategic reserves could keep upward price pressure for an extended period.

The market’s reaction reflects repeated expectations of a deal, but the current price levels are the lowest since the early days of the conflict, still above the pre-war range of the $60s per barrel.