Oil prices took a significant dip while stocks surged on Friday after the Iranian foreign minister announced that the Strait of Hormuz is “completely open.” This remark is being interpreted by traders as a potential easing of tensions that have been affecting global energy markets.
Seyed Abbas Araghchi, Iran’s foreign minister, shared this update on X during a ceasefire period between Israel and Lebanon. He emphasized that vessels navigating through this critical waterway must adhere to a designated route established by Iran’s maritime authorities.
Market reactions were swift; U.S. crude futures for May plummeted 11.1% to $84.26 per barrel, while June Brent crude fell by 10.5% to $88.95.
This shift followed President Donald Trump’s remarks indicating that the ongoing conflict in Iran, which began on February 28, “should be ending pretty soon.” Trump acknowledged Iran’s decision to open the strait but reiterated that a U.S. naval blockade would persist until an agreement with Tehran is reached.
BREAKING: US oil prices crash to $83/barrel as Iran officially reopens the Strait of Hormuz for the remainder of the ceasefire. pic.twitter.com/DorAuSEck9
— The Kobeissi Letter (@KobeissiLetter) April 17, 2026
The recent changes in oil prices occur amidst diplomatic efforts to stabilize the area. A 10-day ceasefire was established on Thursday between Israel and Lebanon, starting at 5 p.m. ET, after Israel’s military actions against Hezbollah, the Iranian-supported group.
President Trump announced plans to invite Israeli Prime Minister Benjamin Netanyahu and Lebanese President Joseph Aoun to the White House for what he termed the first significant dialogue between the nations since 1983.
The State Department indicated that both parties are working towards a lasting peace, focusing on mutual recognition of sovereignty and improved border security. Concerns were raised about the influence of non-state armed groups in Lebanon, and Trump expressed his expectation for Lebanon to address the Hezbollah issue.
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Despite Friday’s market recovery, analysts caution that supply risks remain. ING noted that oil had already been trending down due to expectations of an extended ceasefire between the U.S. and Iran, yet warned that the underlying physical market continues to show strain.
ING’s analysts stated, “The physical market is becoming tighter every day that passes without a restart of oil flows through the Strait of Hormuz.”
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They also assessed that nearly 13 million barrels per day of supply has faced disruption, even when considering adjustments in pipeline routes and limited tanker movements, with potential for further declines if U.S. blockades tighten.
There remains a significant risk that ongoing peace talks between the U.S. and Iran could falter, given the substantial gaps in demands from both sides.
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