Trump Announces Iran Peace Deal as Oil Prices Fall and Strait of Hormuz Set to Reopen This Week

The United States and Iran have announced a tentative agreement aimed at ending more than three months of conflict, raising hopes for stability in the Middle East while leaving major questions unresolved over Tehran's nuclear ambitions, regional influence, and the future of the Strait of Hormuz.

The breakthrough was first revealed by Pakistani Prime Minister Shehbaz Sharif, whose government played a mediating role in the negotiations. Shortly afterward, U.S. President Donald Trump confirmed the development, declaring that "the deal with the Islamic Republic of Iran is now complete" and describing it as a path toward lasting peace and regional security.

Under the preliminary arrangement, both sides have agreed to an immediate halt to military operations. Iranian Deputy Foreign Minister Kazem Gharibabadi stated that the war had ended "on all fronts, including Lebanon," while an official signing ceremony is expected to take place in Switzerland on Friday.

One of the most closely watched elements of the agreement concerns the Strait of Hormuz, a vital maritime route through which roughly one-fifth of global oil supplies pass. Trump said he had authorized the removal of the U.S. naval blockade and approved the reopening of the waterway, proclaiming: "Ships of the World, start your engines. Let the oil flow!" He later clarified that full reopening would occur following the signing ceremony and after mine-clearing operations are completed.

The effective closure of the strait during the conflict disrupted global energy markets for months, pushing oil and gas prices sharply higher and fueling inflation in many countries. News of the agreement immediately triggered a strong reaction across financial markets. Brent crude fell by more than four percent, while U.S. benchmark oil prices dropped toward levels not seen since the beginning of March. Stock markets across Asia rallied, with major indexes in Tokyo and Seoul posting gains exceeding five percent.

Despite the optimism, significant uncertainty remains. The agreement does not yet appear to fully resolve disputes surrounding Iran's nuclear program, ballistic missile capabilities, regional proxy groups, or human rights concerns. Middle East analyst Kylie Moore-Gilbert warned that many of the issues that led to the conflict remain untouched, arguing that the deal could merely postpone future confrontations. "All those sticking points remain," she said, adding that the agreement may simply be "kicking the can down the road to the next conflict."

Conflicting accounts have also emerged regarding the exact terms of the deal. Iranian media reported that the agreement could include the phased release of billions of dollars in frozen Iranian assets and the easing of sanctions during a 60-day negotiation period intended to produce a final settlement. Washington has not publicly confirmed those details.

European leaders broadly welcomed the announcement while stressing that further work is needed. British Prime Minister Keir Starmer described the agreement as an important step forward but emphasized that "Iran must never have a nuclear weapon." French President Emmanuel Macron called for the urgent reopening of the Strait of Hormuz, while German Chancellor Friedrich Merz said the breakthrough could help strengthen both global economic stability and regional security if implemented effectively.

The United Nations also praised the development. Secretary-General António Guterres called the agreement a "critical step" toward ending the conflict and thanked mediators from Pakistan, Qatar, Saudi Arabia, Egypt, and Turkey for their role in the negotiations.

The announcement came after a tense weekend marked by renewed Israeli strikes against Hezbollah-linked targets in Beirut. Trump publicly criticized Israeli Prime Minister Benjamin Netanyahu over the operation, arguing that it risked undermining delicate diplomatic efforts. Iran also condemned the strikes, warning they would not go unanswered.

While markets have reacted positively, industry experts caution that a full return to normal conditions may take months. Thousands of vessels remain affected by disruptions in Gulf shipping lanes, while concerns persist over potential naval mines and damage to regional energy infrastructure. Shipping and energy specialists warned that restoring normal oil flows and supply chains could prove far more complicated than simply signing an agreement.

For now, both Washington and Tehran are presenting the accord as the beginning of a new diplomatic phase. However, with crucial issues still unresolved and negotiations expected to continue after the signing ceremony, the durability of the agreement remains uncertain. The coming weeks are likely to determine whether the deal marks the end of the conflict or merely a pause before the next round of tensions.