Brent Crude Drops 7% After Iran Opens Strait of Hormuz During Ceasefire

Iran’s Foreign Minister Seyed Abbas Araghchi declared the Strait of Hormuz open for all commercial vessels on April 17. The announcement came as part of the 10-day Israel-Lebanon ceasefire that took effect today.

The opening, however, remains conditional. Vessels must follow coordinated routes set by Iran’s Ports and Maritime Organisation. The access lasts only for the remaining period of the truce.

Oil Prices Slide on Easing Supply Fears

The announcement triggered an immediate sell-off in energy markets. Brent crude fell 6.84%, retreating from $99.39 on April 16 to around $92. US crude oil dropped 7.04% in a similar move.

The Strait of Hormuz handles roughly 20% of the world’s daily oil and liquefied natural gas shipments. Iran had effectively restricted passage through the waterway during the broader conflict, pushing Brent above $100 earlier this month.

Markets had already been pricing in a potential resolution. Oil dipped below $95 on April 14 after the White House signaled progress in US-Iran negotiations.

Brent Oil price Performance. Source: TradingView

Trump Claims Credit, Bitcoin Gains

US President Donald Trump reacted quickly on Truth Social, writing that “the Strait of Iran is fully open and ready for full passage.” He notably used “Strait of Iran” rather than the correct name.

Trump’s framing suggested unrestricted access, though Iran’s terms limit the opening to the ceasefire period and designated shipping lanes.

Beyond oil, other markets responded positively. Bitcoin (BTC) gained 1.59%, while the S&P 500 edged up 0.07%, reflecting a broader risk-on shift.

Bitcoin, S&P500, Brent and WTI Price Performance. Source: TradingView

The relief may prove short-lived. The US-Iran ceasefire expires on April 21, and any violation of the Lebanon truce could reverse the opening. Broader negotiations over Iran’s nuclear program and sanctions remain unresolved.