Oil prices waver as investors await US-Iran deal to reopen Strait of Hormuz

Key Points:

• Oil prices showed cautious fluctuations as investors anticipate a potential deal to end the conflict between the U.S. and Iran, with Brent Crude briefly surpassing $80 per barrel before settling near $79.
• The preliminary agreement, expected to be signed on Friday, may include a 60-day ceasefire and the reopening of the Strait of Hormuz to commercial traffic, a critical chokepoint for about 20% of global crude oil.
• Despite optimism, details of the deal remain unclear, with President Trump denying involvement in a $300 billion fund to develop Iran’s economy and disputing leaked information about the agreement.
• Trump expressed confidence that the Strait of Hormuz would be fully reopened within two days under the deal and linked progress in negotiations to rising stock markets and potentially lower oil prices.
• Since the announcement of the deal framework, oil prices have declined from wartime highs near $120 per barrel but have not yet returned to pre-war levels of $65 to $75 per barrel.