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Oil prices fall to three-month low as US-Iran deal raises hopes of Hormuz reopening

By The South Asia Times

WASHINGTON - Global oil prices fell to their lowest levels in nearly three months on Monday after U.S. President Donald Trump announced a breakthrough agreement with Iran that could lead to the reopening of the strategically vital Strait of Hormuz.

Brent crude futures dropped below $90 a barrel as markets reacted positively to signs of easing tensions in the Gulf, a region responsible for a significant share of the world's oil exports.

The United States and Iran have said they reached an agreement aimed at ending a U.S. blockade of Iranian ports and restoring maritime traffic through the Strait of Hormuz, one of the world's most important energy shipping routes.

U.S. Vice President JD Vance said the agreement was electronically signed on Sunday and that no sanctions relief or financial transfers had yet taken place. A formal signing ceremony is expected in Switzerland on Friday.

However, uncertainty remains over key provisions of the deal. Vance said technical negotiations would continue on the long-term operation of the strait, including whether vessels would be allowed to pass without fees.

Iranian-linked media reports have suggested Tehran may permit free passage through the waterway for 60 days before potentially reintroducing transit charges, a claim that could complicate ongoing negotiations.

The agreement has drawn worldwide attention ahead of the Group of Seven (G7) summit in Europe, where leaders are expected to discuss its implications for regional security, global energy supplies and economic stability.

Analysts said while markets welcomed the diplomatic breakthrough, the broader economic impact of the three-month conflict could take months to fully reverse.