by Benjamin Roberts
Oil prices fell well below $100 after President Trump announced a ceasefire in the Iran War on Tuesday evening.
The global pricing benchmark Brent crude dropped from $111 to $91 as markets opened on Wednesday. The United States domestic oil blend, West Texas Intermediate, fell by nearly 20% to trading at $92.
Brent prices skyrocketed in Operation Epic Fury’s immediate aftermath, shooting from $70 to over $110 in one month. U.S. gasoline prices rose from $2.98 to over $4.10 per gallon as Iranian retaliation shuttered the Strait of Hormuz and the global oil trade, according to AAA.
Oil prices’ steep decline could continue if the ceasefire is maintained and a permanent agreement is reached. For every $10 decrease in Brent’s price, U.S. gasoline drops roughly 24 cents per gallon. However, Brent could soar to previous highs if the conflict heats up again.
Brent crude dipped under $100 mid-war after Trump announced a temporary hold on U.S. strikes against Iranian energy facilities. Prices quickly returned to over $110 after the conflict continued and market confidence fell.
It remains to be seen how oil prices will be tomorrow after Iran announced on Tuesday that it was again restricting passage through the Strait of Hormuz. According to The Hill, Iran made this decision due to Israel’s air strikes in Lebanon after the ceasefire agreement. Israeli air strikes caused nearly 200 people to die in Beirut, Lebanon, the country’s capital.
Seyed Abbas Araghchi, foreign affairs minister for Iran, said, “The Iran–U.S. Ceasefire terms are clear and explicit: the U.S. must choose—ceasefire or continued war via Israel. It cannot have both.The world sees the massacres in Lebanon. The ball is in the U.S. court, and the world is watching whether it will act on its commitments.”
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Benjamin Roberts is a reporter at Daily Caller News Foundation. Zachery Schmidt is the digital editor of The Star News Network and contributed to this story.
