Oil prices slide after Pakistan announces deal between US and Iran
Summary
Oil prices dropped sharply after Pakistan announced a deal between the United States and Iran that would reopen the Strait of Hormuz, a major shipping route for oil. The deal is expected to ease tensions and restore the flow of oil through this critical passage.Key Facts
- Oil prices fell significantly, with Brent crude down 3.8% to $84.02 a barrel and US oil down 4.1% to $81.40.
- Pakistan, acting as a mediator, announced a US-Iran deal to reopen the Strait of Hormuz.
- The reopening agreement will be officially signed on June 19 in Switzerland.
- President Donald Trump confirmed on social media that “oil will flow” again through the strait.
- The Strait of Hormuz was effectively closed since late February after US and Israeli airstrikes on Iran.
- Iran had threatened to attack ships using the strait, which usually handles about 20% of the world’s oil and liquefied natural gas.
- Oil prices rose from around $70 before the conflict to a peak near $120 during the heightened tensions.
- The stability of the Strait of Hormuz is crucial to global energy markets and the wider economy.
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