Oil prices wobble as investors await US-Iran deal to reopen Strait of Hormuz
President Donald Trump said when he met with Egypt during the G7 Summit in France that the upcoming agreement between the US and Iran has contributed to the drop in oil prices near pre-war levels and the rise in stock prices.
Oil prices were volatile on Wednesday as investors carefully awaited an upcoming deal to end the war between the United States and Iran.
The terms of the initial agreement have not been released by either country, but traders will be looking to see if the talks will eventually lead to the Strait of Hormuz being reopened to commerce, as President Donald Trump said. The agreement is expected to be signed on Friday.
The market showed tempered optimism, with the price of Brent Crude, the global benchmark for oil, rising by one percent. The price per barrel jumped above $80 for several hours before returning to $79.
West Texas Intermediate Crude, the US benchmark, also rose more than one percent to around $77 a barrel, but eased to around $76.60.
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A navy ship is seen sailing through the Strait of Hormuz, an important waterway through which most of the world’s oil and gas flows on March 1, 2026. (Sahar AL ATTAR / AFP via Getty Images / Getty Images)
Before the US launched strikes on Iran on February 28, about 20 percent of crude oil passed through the critical channel that connects the Persian Gulf to the open sea. In late April, Brent Crude reached a wartime high of around $120 per barrel.
Oil prices have fallen since the US and Iran announced a draft deal, which would include a 60-day freeze and reopening of the Strait of Hormuz. Prices have not stabilized at pre-war levels, which saw oil selling in the $65 to $75 barrel range.
Speaking to reporters at the G7 Summit in France on Wednesday, Trump celebrated the progress made with Iran and pointed to rising stock prices as evidence that the talks are on the right track.
President Donald Trump raises his hand before boarding Air Force One hours after hosting a UFC fight on the White House South Lawn. (Anna Moneymaker / Getty Images)
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“We have a very hot stock market, and we have started to have very low oil prices,” he said at the G7 bilateral meeting with Egypt. “And I think oil prices may be lower than they were before the war.”
Trump also said he expects the Strait of Hormuz to be “fully opened” within two days under the agreement.
Tankers are seen at Khor Fakkan Container Terminal, the only natural deep-sea port in the region and one of the largest ports in Sharjah Emirate, near the Strait of Hormuz, a waterway through which a fifth of the world’s oil exports pass. (Giuseppe Cacace/AFP via Getty Images/Getty Images)
The terms of the agreement remain unclear, and Trump has called some details of the leaked memorandum of understanding between the US and Iran “false.”
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Specifically, Trump said the US would not contribute to a $300 billion fund to boost Iran’s economy.
“No, we don’t invest. We don’t put in $0.10. Again, people can decide to do that, but that’s up to them. I mean, do you want me to say that no one has ever been allowed to invest in the country?” Trump told Fox News’ Peter Doocy.
