Oil slides after Trump agrees to conditional two-week Iran ceasefire

Global Oil Prices Drop Following Trump’s Conditional Ceasefire Agreement with Iran

Energy markets experienced a significant decline after President Donald Trump proposed a two-week ceasefire with Iran, tied to the safe operation of vessels in the strategic Strait of Hormuz. US-traded crude fell by nearly 16.5% to $93.80, yet prices still surpassed levels seen prior to the conflict’s outbreak on 28 February.

The recent surge in energy costs was driven by disruptions to Middle Eastern oil and gas supplies, as Iran threatened to attack ships navigating the strait in retaliation for US and Israeli airstrikes. By agreeing to a conditional pause in hostilities, Trump sought to mitigate further escalation, though the deal remains dependent on Iran’s commitment to open the waterway unimpeded.

“Trump had established a deadline for 20:00 EDT on Tuesday (00:00 GMT on Wednesday), warning that ‘a whole civilisation will die tonight’ should a compromise not be achieved,” stated Xavier Smith from market research firm AlphaSense.

Despite his earlier warnings, Smith noted that Trump’s decision to delay conflict escalation likely reflected concerns about allowing energy prices to skyrocket. This could create a “self-inflicted economic wound,” he added, particularly with the political weight of approval ratings pressing on the president’s agenda.