Oil falls over 4% after US-Iran peace deal reopens Strait of Hormuz

International oil prices fell more than 4% after reports said the United States and Iran reached a peace deal that reopened the strategic Strait of Hormuz. The market reacted quickly as perceived supply risks eased following the announcement, pushing prices down. While the agreement reduced immediate geopolitical risk and improved confidence in maritime transport, the durability and implementation of the deal remain uncertain. Future oil supply and price trends will depend on how the agreement is carried out and any subsequent developments in the region.

The Strait of Hormuz is a key route for global oil shipments, so its reopening reduces perceived supply risk and can drive prices lower. A sharp drop in oil prices affects energy costs, inflation expectations, and energy-sector assets; market participants should monitor implementation of the deal and any residual or renewed regional risks that could reverse the price move.