Global oil markets fell sharply after Iran confirmed the reopening of the Strait of Hormuz to commercial shipping for the duration of the ongoing ceasefire, easing fears of supply disruptions in one of the world’s most critical energy corridors.

US crude prices dropped below the $84-per-barrel level following the announcement, as traders reacted to expectations of smoother oil flows through the region. Market sentiment shifted rapidly after concerns over potential shipping restrictions began to fade.

Iran’s Foreign Minister Seyed Abbas Araghchi confirmed the decision in a post on X, stating that, in line with the Lebanon ceasefire, passage for all commercial vessels through the waterway has been fully restored for the remaining period of the truce under previously coordinated maritime routes.

At the time of reporting, West Texas Intermediate (WTI) crude had fallen by $5.69, or roughly 6 percent, trading near $89 per barrel. Brent crude also declined by $5.18, or about 5.2 percent, to $94.21 per barrel, reflecting a broad sell-off across global energy markets.

The price decline followed Iran’s decision to reopen the vital shipping lane moments earlier, a move widely viewed as reducing immediate geopolitical risk and stabilizing expectations for global oil supply during the ceasefire period.