Crude oil prices tumbled to their lowest levels in eight weeks on Friday as traders grew more confident that a U.S.-Iran peace deal could reopen the Strait of Hormuz, a vital shipping lane that has been effectively closed since March 2026. U.S. crude oil fell 3.2% to close at $84.88 per barrel, while Brent crude, the international benchmark, lost 3.4% to settle at $87.33.
A senior Trump administration official told reporters there is an 80% chance the U.S. and Iran will sign an agreement to reopen the waterway in the coming days, according to CNBC. The official said the deal would lift the U.S. naval blockade, dismantle Iran’s nuclear program, and remove its enriched uranium in exchange for financial incentives if Iran complies.
The Strait of Hormuz is one of the world’s most critical energy chokepoints, carrying roughly 20% of the world’s daily oil supply, according to government and research sources. When Iran closed the strait in early March 2026 in response to U.S. and Israeli airstrikes, it created a historic supply shock that drove crude prices toward $100 a barrel at their peak.
Despite the optimism, oil prices remain significantly elevated compared to pre-conflict levels. Crude oil has fallen about 6% for the week but is still up more than 20% since the U.S. and Israel attacked Iran on February 28, 2026, according to CNBC. The elevated prices reflect lingering geopolitical risk and the fact that any deal would take time to fully restore normal oil flows through the strait.
Iran’s Foreign Minister Seyed Abbas Araghchi said in a social media post that a memorandum of understanding between the U.S. and Iran “has never been closer,” signaling momentum in negotiations. Pakistan’s Prime Minister Shehbaz Sharif, who has mediated the talks, said a final agreed-upon text of the peace deal has been reached and that both sides are working to finalize the next steps.
However, uncertainty persists about the deal’s final terms. Iranian state news agency Mehr released a draft proposal that appeared more favorable to Tehran, claiming the U.S. would provide $300 billion in reconstruction money and withdraw its forces from the region. President Trump dismissed the Iranian document, stating on Truth Social that “the terms that Iran leaked out to the Fake News have NOTHING to do with the terms that were agreed to, in writing.”
Energy markets have responded sharply to each signal in the negotiations. When hopes for a deal rise, oil prices fall due to expectations of restored supply through the Strait. Conversely, setbacks in talks or escalations in regional tensions have triggered price rallies. The volatility reflects how central the strait is to global energy security and the broader economic impact of disrupted oil supplies.
Sources
- CNBC — oil prices falling to $84.88 WTI and $87.33 Brent on Iran deal hopes, Trump administration official’s 80% confidence level, and context on the proposed deal terms
- Trading Economics — crude oil prices at $84.88 on June 14, 2026, down 3.23% from the previous day
- Carra Globe — Strait of Hormuz carrying 20% of the world’s daily oil supply and LNG
- Congress.gov — historical context on the Strait of Hormuz closure beginning March 4, 2026, and its role in global oil supply
- Reuters — oil prices falling on hopes for U.S.-Iran ceasefire agreement and WTI dropping more than 9% for its biggest weekly loss in six weeks
