World oil prices plunge after announcement of two-week truce in Middle East

Global oil prices fell sharply after the US President Donald Trump agreed to a two-week ceasefire with Iran.

According to the Oil Price service, Brent crude futures fell 15% to $92.98 per barrel, while the price of WTI fell 16% to $94.76.

At the same time, the truce between the US, Israel and Iran is expected to be fragile, and therefore markets will be very sensitive to news and developments during the Middle East negotiations.

Investors are hoping for some stabilization in the Strait of Hormuz, which could ease pressure on oil, gas and fertilizer supplies over the next two weeks. However, analysts do not expect energy prices to return to pre-war levels due to significant damage to some of the regionʼs energy infrastructure.

But even under these conditions, Asian stock markets rose sharply on Wednesday, with the US and Europe also expected to have a strong start to the session amid investorsʼ increased risk appetite.

The US Treasury bonds have risen significantly as, amid easing inflation fears due to falling oil prices, traders are once again factoring in the possibility of a rate cut by the Federal Reserve at the end of 2026.

War in the Middle East and negotiations between Iran and the US

On the morning of February 28, the US and Israel launched an attack on Iran. Iranʼs Supreme Leader Ayatollah Ali Khamenei and almost the entire military leadership of the country — about 40 key high-ranking officials — were killed.

Iran, in response to the US and Israeli attacks, began shelling Arab countries and Israel. The war also halted tanker traffic through the Strait of Hormuz, through which almost a fifth of the worldʼs oil exports passed. This led to a sharp increase in oil and gas prices.

On the night of April 8, Trump wrote that he had agreed to a two-week ceasefire with Iran. Later, Iran published a 10-point peace plan: according to it, the parties would cease hostilities, the US would withdraw troops from the Middle East and would no longer attack Iranian bases, and ships would have limited access to the Strait of Hormuz for two weeks.

Iran would also be required to lift primary and secondary sanctions and compensate for losses. Iran itself would commit not to developing nuclear weapons, and the US would recognize Iranʼs right to enrich uranium.

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