As oil prices plunge below $91 after weeks, a new Hormuz crisis emerges

Oil prices have plummeted to their lowest point in weeks after Iran said the Strait of Hormuz was open for passage during a ceasefire in Lebanon, and United States President Donald Trump said he expected to ⁠reach a deal to end the war soon.

Brent crude, the international benchmark, fell more than 9 percent to $90.38 a barrel on Friday, taking it below $91 for the first time since March 10.

The plunge came after Iranian Foreign Minister Abbas Araghchi said the strait was “completely open” and would remain so for the duration of the 10-day ceasefire between Israel and Lebanon, which took effect on Friday.

Hailing Tehran’s announcement, Trump declared the waterway “ready for business and full passage,” but said the US Navy’s blockade of Iranian ports would remain in “full force” until the sides reached a peace deal.

On Saturday, however, Iran rowed back on its decision to reopen the Strait of Hormuz, warning that it would continue to block transit through the key waterway as long as the US blockade of Iranian ports remained in effect.

The announcement came after Trump said the blockade “will remain in full force” until Tehran reaches a deal with the US, including on its nuclear programme.

Roughly one-fifth of the world’s oil passes through Hormuz and further limits would squeeze already constrained supply, driving prices higher once again.

Amid the escalation, Pakistani officials say they are trying for more talks between the US and Iran ahead of the April 22 ceasefire deadline.

Meanwhile, ship tracking data displayed by MarineTraffic earlier on Saturday showed a significant uptick in vessels crossing the strait, which is located between Iran, the United Arab Emirates and Oman.

“It’s busy out there, the busiest I’ve seen it since the Strait of Hormuz was effectively closed at the beginning of the war,” Michelle Wiese Bockmann, an analyst at maritime intelligence firm Windward, said in a post on X.

“Last night there were few ships taking the risk but overnight there seems to have been a change.”

While Iran allowed a limited number of vetted ships to transit the waterway since the start of the war, traffic has remained at a trickle compared with pre-conflict levels.

The near-total closure of the strait has triggered one of the worst energy shocks in history, driving up fuel prices and prompting governments to roll out emergency measures.

Oil prices have swung wildly since the US and Israel launched strikes on Iran on February 28, hitting a post-conflict peak of $119 a barrel on March 19.