Iran Opens Hormuz Strait, Oil Drops, Stocks Rise

Iran's Foreign Minister Abbas Araghchi announced via X that passage through the Strait of Hormuz is fully open to commercial vessels for the duration of the current ceasefire period. The declaration triggered an immediate market response: oil prices fell sharply while equities rallied. The Strait of Hormuz is the world's most critical oil transit chokepoint, handling roughly one-fifth of global petroleum flows; any credible threat to its closure drives a risk premium into energy prices. Araghchi's explicit declaration removes, at least temporarily, that premium, allowing traders to reprice crude lower. The ceasefire framing is the key variable to watch. The opening is conditional on the ceasefire holding, meaning any breakdown in the underlying geopolitical conflict would reinstate supply-disruption fears and reverse the oil selloff. Equity markets are reading the development as a near-term de-escalation signal, but the conditional language leaves the trade exposed to event risk.