Oil Tumbles 20% on US-Iran Ceasefire Breakthrough

The three-month conflict began on 28 February, when the United States and Israel launched airstrikes on Iran. Tehran retaliated by threatening to attack vessels using the Strait of Hormuz, the narrow waterway through which roughly a fifth of the world's oil and liquefied natural gas (LNG) supplies normally pass. The strait has been largely closed ever since, pushing Brent briefly to about $120 a barrel, compared with around $70 before the war. Tensions remained high even during the talks: BBC reported a fresh American strike this week on a military site in the strategic Iranian port of Bandar Abbas. President Donald Trump said he would convene his advisers in the Situation Room to make a "final determination" on the deal.

Despite the rally, gasoline remains nearly 50% above pre-war levels, and oil executives are warning that supplies are dangerously tight. ExxonMobil senior vice president Neil Chapman said inventories were nearing "unheard-of" lows and could push crude above $150 a barrel within weeks, translating to roughly $9-a-gallon gasoline in California. Chevron chief executive Mike Wirth told Bloomberg it could take "weeks and weeks" to clear sea mines and move some 2,000 stranded vessels out of the strait. Independent analysts estimate six to eight weeks will be needed for prices to stabilise once fighting ends. Treasury Secretary Scott Bessent has predicted a dramatic fall in fuel costs the moment the war is over.