Oil Prices Plummet on Iran Ceasefire, but Fears Linger

Oil prices plummeted nearly 20% on Wednesday night after the announcement of a temporary ceasefire between the United States, Israel, and Iran. The agreement includes the reopening of the Strait of Hormuz, which had been closed due to the conflict.

The war had driven global oil prices up by more than $70 a barrel, with West Texas Intermediate (WTI) trading above $114 and Brent around $111 before the announcement. After the ceasefire was announced, prices fell sharply, trading near $96 for both benchmarks.

Market fears centered on the possibility that prolonged disruption from the conflict would keep oil prices elevated, triggering a wave of inflation across the global economy. Trump's threats to strike Iran's power infrastructure heightened investor concerns.