The Strait of Hormuz, a chokepoint that handles roughly 20% of global oil and liquefied natural gas supply, is back in play.
A framework deal between the US and Iran, confirmed on June 14-15 by President Donald Trump, Iranian officials, and Pakistani mediators, has sent benchmark crude prices into a nosedive. West Texas Intermediate fell approximately 5% to around $80-81 per barrel, while Brent dropped about 4% to roughly $83 per barrel, hitting three-month lows.
The deal, the drop, and the domino effect
For the past four months, the conflict between the US and Iran had choked off one of the world’s most critical shipping lanes. Brent crude had surged above $120 per barrel earlier in 2026 when the Strait of Hormuz was effectively closed.
The agreement aims to reopen the Strait for commercial shipping and kickstart negotiations around Iran’s nuclear program. Asian refiners, particularly those in India, are already reassessing their positions on Iranian crude purchases. The prospect of sanctions relief has opened a window that buyers haven’t had in months. Estimates tied to the potential purchasing activity reference figures in the ballpark of $24 billion.
