Oil prices fell sharply on Sunday after President Donald Trump said talks with Iran on restoring shipping through the Strait of Hormuz were making progress. At the same time, he stressed that the U.S. was not going to rush into a deal.
According to CNBC, WTI crude futures fell by about 5% to $91.65 per barrel. Brent also lost around 5% and dropped to $98.30 per barrel.
On Saturday, the U.S. president said an agreement with Iran to reopen the Strait of Hormuz, along with several other issues, had largely been negotiated and would be announced soon. Trump had previously suggested that the conflict with Iran was close to resolution, but tensions later escalated again, sending oil prices sharply higher.
Last week, U.S. crude lost more than 8%, while Brent fell by over 5% after Trump said he had called off planned airstrikes on Iran to give negotiations more time. At the same time, oil prices have risen by more than 30% since February 28, when the U.S. and Israel attacked Iran.
Negotiations continue
However, on Sunday, Donald Trump said U.S. negotiators should not rush into an agreement with Iran that could lead to the full reopening of shipping through the Strait of Hormuz. According to the U.S. president, both sides should “take their time and get it right,” the Financial Times reported.
Trump’s new statement showed that negotiations could drag on. In a post on Truth Social, he wrote that the process was moving in an “orderly and constructive” manner and compared it with the talks that led to the 2015 nuclear deal, from which the U.S. withdrew during his first presidential term. According to Trump, the current approach is the “complete opposite” of those negotiations.
Later, a senior administration official said the agreement with Iran would not be signed on Sunday, although the sides had made progress. A diplomat familiar with the discussions said the deal would effectively extend the fragile April 8 ceasefire for another 60 days. During this period, the Strait of Hormuz would gradually reopen, while the sides would lay the groundwork for talks on Iran’s nuclear program.
Trump also stressed that the U.S. Navy blockade of Iranian ports, which could be eased if a deal is reached, would remain in “full force” until an agreement is reached, certified, and signed. “Both sides must take their time and get it right. There can be no mistakes,” the U.S. president said.
How it started
The U.S. and Israel launched strikes against Iran in late February. After that, the sides agreed to a fragile ceasefire on April 8, but a full settlement was not achieved. Against the backdrop of the continuing threat of new attacks, Tehran began using the Strait of Hormuz as its main pressure point, since a significant share of global oil supplies passes through this route.
As a result, Iran effectively slowed vessel traffic through the strait to a minimum, requiring ships to obtain permission to pass. This quickly turned the military conflict into an energy crisis: supplies from the Middle East declined, oil prices surged, and the U.S. responded by increasing pressure on Iran and imposing a blockade on its ports and vessels. That is why negotiations over reopening the Strait of Hormuz have become a key element of the broader deal between Washington and Tehran.
As a reminder, the government bond market, usually seen as a safe haven during crises, has also come under pressure.
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