LONDON — Oil prices plunged below $100 a barrel Wednesday after U.S. President Donald Trump said Washington had agreed to a two-week ceasefire with Iran, with Brent crude falling to about $91.80 and U.S. crude sliding to roughly $92.62, April 8, 2026. The sell-off reflected bets that the Strait of Hormuz could reopen and start to ease the supply shock that had sent energy costs surging and shaken financial markets.
Why oil prices fell so fast
According to Reuters reporting on the oil-market move, the truce was tied to the immediate and safe reopening of Hormuz, the narrow waterway through which about 20% of the world’s daily oil supply passes. The same report said traders were beginning to price in the gradual release of an estimated 10 million to 13 million barrels a day of crude and refined products stranded behind the chokepoint, even as analysts warned that a geopolitical premium could linger if talks break down.
What markets are betting on now
The relief spread well beyond crude. AP reported that U.S. stock futures jumped as oil dropped, while Reuters’ global markets roundup said Japan’s Nikkei gained more than 5%, South Korea’s Kospi more than 6% and Europe’s STOXX 600 about 3.5% as investors rotated back into travel, banks, technology and industrials. Energy producers moved the other way, a sign that the market had quickly shifted from pricing scarcity to pricing de-escalation.
The catch is that traders are not treating this as a finished peace. Reuters’ breakdown of the ceasefire terms shows that major disputes remain over uranium enrichment, Iran’s missile program, sanctions relief and even the longer-term status of the Strait of Hormuz. Israel has also said its operations in Lebanon are not covered, which helps explain why the market reaction looks more like a sharp relief rally than an all-clear signal.
That distinction matters. A temporary reopening can bring down futures quickly, but physical markets, shipping insurance and refinery planning usually normalize more slowly. Even after Wednesday’s drop, crude remains well above prewar levels, and any renewed threat to tanker traffic could rebuild risk premiums in a hurry.
Oil prices have followed this script before
There is recent history for this kind of violent reversal. In June 2025, AP reported oil tumbled and stocks rose after Iran retaliated but avoided energy targets. In April 2024, AP noted prices fell after Iran’s strike on Israel was largely thwarted and Washington signaled it did not want a wider war. And in September 2019, AP reported prices jumped more than 14% after attacks on key Saudi oil facilities, underscoring how quickly crude can reprice when traders swing between outright supply loss and rapid de-escalation.
For investors, consumers and central banks, the immediate message is simple: oil can still become the world’s fastest-moving macro signal when the Gulf is in play. The ceasefire has bought markets time and knocked out a chunk of the panic premium, but the next leg for crude will depend less on the headline than on whether ships move freely, refineries secure feedstock and negotiators can turn a two-week pause into something more durable.
