The war that rattled global energy markets for nearly four months may finally have an off-ramp. Iran and the United States have reached a framework agreement to halt hostilities and reopen the Strait of Hormuz to commercial shipping, a development that immediately cratered oil prices and sent shockwaves through every asset class tied to energy.
Crude prices dropped more than 4% in Asian trading following the announcement, with intraday swings reaching as much as 9%. The Strait of Hormuz handles roughly 20% of the world’s oil and liquefied natural gas flows.
How we got here
The conflict traces back to February 28, 2026, when hostilities between Iran and the US escalated into open confrontation. By March, Iran had effectively closed the Strait of Hormuz. The US responded with a naval blockade of Iranian ports.
A temporary ceasefire was reached in April 2026, offering a brief reprieve, but it barely held.
