Oil Prices Plunge as US and Iran Pause Strikes in Strait of Hormuz

Oil prices plummeted over 8% on Monday after the United States and Iran paused their strikes, reviving hopes for a diplomatic breakthrough in the Strait of Hormuz. The non-expiry crude contract dropped to $82.24, while Brent crude futures fell by 5.9% to $91.08 a barrel.

The pause in hostilities followed two weeks of escalating conflict in the region, which had disrupted oil shipments through the critical waterway and pushed prices sharply higher. However, analysts remain cautious about the durability of the pause, noting that a stay of military strikes does not guarantee a swift return to normal oil flows.

Iran indicated it would suspend its own attacks as long as the U.S. pause in hostilities remains in place, according to a senior Iranian official cited by Reuters. The International benchmark Brent crude futures for September delivery fell 7.4% to around $89.58 a barrel, while U.S. West Texas Intermediate crude futures for September delivery dropped 6.8% to $83.25 a barrel.