Oil prices fall as Pakistan brokers US‑Iran deal
U.S. and Iranian tensions eased after Pakistan announced a deal that could reopen the Strait of Hormuz, leading Brent crude to slip 4% to $83.81 a barrel and U.K.‑traded oil to fall 4.7% to $80.89.
Prime Minister Shehbaz Sharif announced that the final signing ceremony would take place on Friday, 19 June in Switzerland, while Iran’s Deputy Foreign Minister Kazem Gharibabadi confirmed over state TV that the agreement had been finalized. President Trump echoed the announcement on social media, tweeting “let the oil flow!”.
Energy‑market analyst Vandana Hari cautioned that the lack of detail on any technical clauses could inject a week of volatility for oil traders, potentially leaving prices unsettled amid turbulent markets.
The Strait of Hormuz, which handled roughly 20% of global oil and LNG traffic, had been effectively closed since airstrikes by the U.S. and Israel on Iran on 28 February. Tehran warned it might attack vessels transiting the waterway, further tightening supply constraints.
Brent crude had surged to about $120 during the conflict from its $70 baseline before the war and could not be expected to return to pre‑ war levels instantly once the gate opens; mines will need clearing, and a backlog of tankers will have to be thinned out, a process that may take weeks or even months.
Asian equity markets responded favorably to the announcement: Japan’s Nikkei 225 climbed 4.3% in morning trading and Korea’s Kospi advanced more than 5%. The region, heavily reliant on Middle‑East supplies, has historically been sensitive to spikes in oil prices, making these early signs of recovery significant for investors.
