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US-Iran Deal and Hormuz Reopening Trigger Market Selloff (Image Internet)
Tehran: Global oil prices moved lower in early trading on Thursday after the United States and Iran signed an interim agreement designed to end hostilities and restore normal shipping through the Strait of Hormuz, one of the world's most critical energy transit routes.
Market data showed that Brent crude futures fell by 89 cents, or 1.12 percent, to $78.66 per barrel. Meanwhile, US West Texas Intermediate (WTI) crude declined by 98 cents, or 1.28 percent, to $75.81 per barrel during early trading hours.
The decline reflects growing confidence among traders that the risk of major supply disruptions in the Middle East could ease if the agreement holds.
The Strait of Hormuz remains a key chokepoint for global energy markets, with a significant share of the world's oil exports passing through the narrow waterway. Concerns over shipping disruptions in recent weeks had pushed oil prices higher amid fears that escalating tensions could affect global supply.
The interim agreement between Washington and Tehran is expected to facilitate the reopening of the strategic route, reducing immediate concerns over energy transportation.
Oil markets often react sharply to developments in the Middle East due to the region's importance in global crude production and exports. The latest price movement suggests investors are reassessing risk premiums that had been built into oil prices during the period of heightened uncertainty.
Analysts say traders will continue monitoring developments surrounding the agreement and the pace at which shipping activity returns to normal in the Strait of Hormuz.
While the agreement has provided short-term relief to energy markets, investors remain cautious. Future price movements are likely to depend on the implementation of the deal, regional stability, and broader global demand trends in the coming weeks.
