April 8 (UPI) -- Global oil prices tumbled after the United States, Israel and Iran agreed to a Pakistan-brokered two-week cease-fire deal that included reopening the Strait of Hormuz to international shipping.
The Brent crude and West Texas Intermediate benchmarks saw double-digit percentage falls following U.S. President Donald Trump's announcement of the breakthrough Tuesday evening, and have since stabilized, changing hands at $95.51 and $96.48 a barrel in early trade on Wednesday.
The market reacted to the prospect that oil tankers trapped in the Persian Gulf would be finally be able to transit the 21-mile-wide body of water between Iran and the UAE and Oman, easing major disruption to global supply caused by Iran's effective blockade of the strait.
However, oil remained well above its $72 a barrel level on Feb. 27, the day before the United States and Israel unleashed their airborne offensive against Iran, amid uncertainty over the mechanism for the resumption of maritime traffic in the strait and the ongoing impact of war damage to energy infrastructure in Gulf countries.
There was also confusion over whether the cease-fire extended to Israel's military offensive against Hezbollah in Lebanon. Pakistan said it did, but Israel said it did not and that its operations would continue.
