Oil Drops 10% as Hormuz Stays Open in Ceasefire

Oil prices fell close to 10% after Iran signaled that the Strait of Hormuz would remain fully open during the US-Iran ceasefire, removing a key supply-disruption premium that markets had built into crude valuations. Brent crude and West Texas Intermediate both dropped sharply as traders unwound risk positions tied to fears of a blockade on one of the world's most critical energy chokepoints. The Strait of Hormuz carries roughly one-fifth of global oil supply, meaning any credible closure threat directly compresses refiner margins, inflates spot prices, and ripples into fuel costs across importing economies. With Iran explicitly confirming passage would continue unimpeded, that fear premium deflated rapidly. The move signals how much of recent crude pricing was driven by geopolitical risk rather than physical supply-demand fundamentals. Analysts expect volatility to persist given the fragility of ceasefire arrangements and the speed with which sentiment can reverse. Energy traders, refiners exposed to spot markets, and fuel-sensitive sectors such as aviation and shipping face a recalibrated cost environment as the situation develops.