Washington (HRNW)- Global crude oil prices declined sharply after US President Donald Trump canceled a planned major military strike on Iran and announced the resumption of peace negotiations.
According to the World News Agency, although commercial shipping through the Strait of Hormuz has not yet fully recovered following President Trump’s announcement, oil prices fell significantly in the global market.
On Monday, the price of Brent crude, the global benchmark, dropped by about 4.2 percent to $84 per barrel, while West Texas Intermediate (WTI) crude fell by 5 percent to around $80 per barrel.
Oil and gas shipping experts said investors sold oil in anticipation that easing tensions between the United States and Iran could reduce the risk of supply disruptions in the Middle East.
According to the report, Iran has not yet officially announced the full reopening of the Strait of Hormuz to commercial shipping. However, the Iranian Foreign Ministry said discussions are underway with Oman to establish a temporary secure maritime corridor.
If those negotiations succeed, ships could resume limited transit through the corridor, which analysts say may further reduce global oil and gas prices.
Currently, around 5 million barrels of crude oil per day are transported through the Strait of Hormuz via the southern route near the coast of Oman, compared with an average of 20 million barrels per day before the conflict.
Meanwhile, Saudi Arabia has redirected part of its oil exports westward through the Red Sea. However, that route passes through the Bab al-Mandab Strait, where attacks by Iran-backed Houthi forces have continued, keeping concerns over global energy supplies alive.
Analysts say that if negotiations between the United States and Iran lead to the full reopening of the Strait of Hormuz, global oil prices could return to pre-conflict levels. However, the security situation around the Bab al-Mandab Strait and broader regional tensions continue to pose risks to the global energy market.
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