Global oil prices experienced a significant decline on Tuesday after a ceasefire agreement between Iran and Israel was announced in the early hours of the day.

Brent crude fell by$2.08, or 2.9 percent, settling at$69.40 a barrel by 0330 GMT. Earlier in the session, it had dropped more than 4 percent, reaching its lowest level since June 11. Meanwhile, US West Texas Intermediate (WTI) crude decreased by$2.03, or 3.0 percent, to$66.48 per barrel, having previously slid 6 percent to a low not seen since June 9.

Former President Donald Trump confirmed late Monday that both Iran and Israel had fully agreed to the ceasefire, with Iran set to implement it immediately and Israel to follow after 12 hours. The conflict, which has lasted 12 days, will officially conclude after 24 hours if the truce holds.

This development has led to a reduction in geopolitical risk premiums within the oil market. The price drop follows a period of volatility, as oil benchmarks had surged to five-month highs following a US strike on Iranian nuclear facilities over the weekend. In the previous session, both Brent and WTI settled over 7 percent lower as the ceasefire announcement shifted market sentiment.