US-Iran Peace Deal Sends Oil Prices Plummeting to Two-Week Lows

Oil prices have plummeted to two-week lows after a Pakistani source revealed that the United States and Iran are closing in on an initial peace deal. Brent crude futures fell by $9.08, or 8.3%, to $100.79 a barrel by 1205 GMT.

This decline marks the biggest daily drop for both benchmarks since mid-April, with U.S. West Texas Intermediate losing $9.12, or 8.9%, to $93.15. The Pakistani source stated that the US and Iran were nearing an agreement on a one-page memorandum of understanding.

The Strait of Hormuz closure has driven up prices, with Brent trading last week at its highest since March 2022. Crude oil supply losses from halted marine traffic through the strait have resulted in a drawdown in global oil and fuel inventories as refineries try to offset production shortfalls.