US President Donald Trump has announced the completion of a peace agreement between the United States and Iran, declaring that the strategically vital Strait of Hormuz will reopen after more than 100 days of disruption.
This move is already bringing results, with oil prices settling down and reports indicating their lowest level in three months.
Brent crude futures settled down $4.16, or 4.76%, to $83.17 a barrel, while U.S. West Texas Intermediate settled at $80.75, down $4.13, or 4.87%, Reuters reported.
Although the full details of the agreement have not yet been made public, Trump made the announcement on his Truth Social account on Sunday, writing:
“The Deal with the Islamic Republic of Iran is now complete. Congratulations to all! 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!”
The announcement marks a significant diplomatic development after a conflict that disrupted one of the world’s most important energy corridors for over three months. According to reports, the formal signing of the agreement is expected to take place later this week in Switzerland.
Trump hailed the agreement as a historic achievement, stating:
“This Great Deal will bring Peace and Security to the whole Region.”
He also praised his administration’s role in the negotiations, saying:
“Many presidents have tried to make Peace with Iran, and all have failed before me. The Leaders of the Region have, for the first time, found a President who can help them achieve real Peace. With the opening of the Strait upon the signing of the Deal on Friday, for purposes of mine removal, oil will flow on both ends again for the Region, and the World!”
Oil Prices Fall
Global energy markets reacted immediately to the announcement. Brent crude oil dropped approximately 4%, falling to around $83–84 per barrel, while U.S. West Texas Intermediate (WTI) crude declined by more than 4.5% to roughly $81 per barrel, as traders anticipated the restoration of oil shipments through the Strait of Hormuz.
The waterway handles nearly 20 million barrels of oil per day, accounting for about 20% of global oil consumption and roughly one-quarter of the world’s seaborne oil trade. Any disruption in the strait has an immediate impact on international energy markets.
Trump has repeatedly argued that ending the conflict would significantly reduce gasoline prices, and the latest market reaction appears to support expectations of lower fuel costs if the agreement holds.
Nuclear Program and Regional Security
While the White House has not released the complete text of the agreement, early reports indicate that the deal includes provisions requiring Iran to halt activities related to the development of nuclear weapons, with further negotiations expected over verification measures and sanctions relief.
Reports also suggest the agreement could include broader regional security arrangements, potentially limiting the expansion of Israeli military operations in Lebanon and reinforcing the ceasefire across multiple fronts. However, these provisions have not yet been officially confirmed.
With the reopening of the Strait of Hormuz and the removal of the U.S. naval blockade, global markets are watching closely to see whether the agreement ushers in a sustained period of stability in the Middle East or serves as the first step toward a broader diplomatic settlement.
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