Oil prices have dropped over 10% in less than two hours after the Minister for Foreign Affairs of Iran declared the Strait of Hormuz "completely open" for the remainder of the current ceasefire with the US.
In a statement shared through X on Friday afternoon, the Minister for Foreign Affairs of Iran, Abbas Araghchi, announced that the Strait of Hormuz is "completely open" in line with the ceasefire in Lebanon.
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Global equity and energy markets immediately reacted to the news.
At the time of writing, the US benchmark WTI has dropped more than 12% to roughly $82 per barrel while Brent crude is down 10% at around $88 per barrel.
US President Donald Trump also welcomed the announcement while reiterating that the US naval blockade of Iranian ports "will remain in full force and effect" until negotiations with Iran are complete.
Trump also added that "most of the points are already negotiated" with Iran for a longer lasting agreement and that "the process should go very quickly".
However, none of the details of a potential deal have yet been publicly shared.
Both the S&P 500 and the Nasdaq are at new all time highs, up more than 1% in the first hour of trading, as the positive news for the global economy begin being digested by the markets.
The Dow Jones Industrial Average has risen even more, by over 1.7%, as it was lagging behind the other indices this week.
It remains to be seen exactly at what speed and volume the traffic through the Strait of Hormuz is restored. The expectation of the markets is now that a definitive resolution to the conflict will be achieved before the end of the month.
With the weekend approaching, traders only have Friday's session to digest the information and price in the developments.
