Global oil prices dropped 6% on Monday, crossing below $90 a barrel.July 27, 2026, 10:33 AMOil prices plunged and stocks surged in early trading on Monday after the U.S. paused attacks on Iran over the weekend, opting against a major escalation of the war.Global prices fell 6% on Monday, briefly crossing below $90 a barrel before moving slightly above that benchmark. The decline reversed a days-long run up in crude prices as fighting threatened to worsen a historic global oil shock.Stock prices climbed in response to the drop in oil prices. The Dow Jones Industrial Average climbed 570 points, or 1.1%, while the S&P 500 jumped 0.6%. The tech-heavy Nasdaq increased 0.6%.Crude costs account for a large share of the price of auto gasoline. The average price of a gallon of gas currently stands at $4.11, according to AAA. Relief in oil prices typically brings down gas prices within days, some analysts previously told ABC News.President Donald Trump has put off a major escalation with Iran in favor of an effort to revive diplomacy to open the Strait of Hormuz, two sources told ABC News.Traders work on the floor of the New York Stock Exchange (NYSE) at the closing bell, in New York City, July 24, 2026.Angela Weiss/AFP via Getty ImagesSources said top officials discussed the impact a major escalation could have on the Pentagon's depleting stockpiles of air defense interceptors, including Patriot anti-missile interceptors.Oil prices have proven volatile in recent weeks. Last month, oil prices briefly fell to their lowest level since before the late February outbreak of the Iran war on news that a preliminary agreement to end the war had been reached.A resumption of large-scale fighting between the U.S. and Iran, however, cast doubt over the staying power of that deal.Popular ReadsShipping traffic in the Strait of Hormuz declined sharply as the war escalated. The maritime trading route facilitates transport of about one-fifth of global oil supply. In turn, worldwide oil prices soared above $100 a barrel.The prospects of diplomacy remain uncertain, despite a slowdown in fighting over recent days.Amid the brief pause in the war between the U.S. and Iran, Iranian Foreign Ministry spokesperson Esmaeil Baghaei told journalists at his weekly press conference on Monday that Iran has "no negotiations with America.""The negotiations that we have, and which may genuinely be subject to different interpretations, are the negotiations we have with Oman. They are focused on creating the necessary arrangements regarding the Strait of Hormuz," Baghaei added.ABC News' Victoria Beaule and Rachel Scott contributed to this report.