Key Moments
- Brent crude initially dropped 14% to USD 95/bbl on US-Iran ceasefire headlines before trimming losses.
- The Strait of Hormuz remains blocked, with Iran signaling a potential reopening later this week pending further agreements.
- Brent futures last moved slightly higher to USD 97/bbl as markets monitored oil flows and infrastructure damage.
Ceasefire News Triggers Sharp Price Swing
Danske Research Team reports that Brent crude saw a steep selloff following initial headlines about a ceasefire between the United States and Iran, but the benchmark has stayed highly reactive to ongoing supply risks in the Middle East.
According to the analysts, “Global markets breathed a sigh of relief as Brent crude fell 14% to USD 95/bbl and equities surged to one-month highs following President Trump’s announcement of a two-week ceasefire late Tuesday.”
Strait of Hormuz Blockage Keeps Supply Risk Elevated
Despite the ceasefire announcement, the Strait of Hormuz is still closed to traffic. The report notes that Iran has only indicated a possible reopening later this week, and that remains contingent on additional agreements being reached.
“The Strait of Hormuz remains blocked, though Iran has indicated it could reopen later this week subject to further agreements.” Danske’s team emphasizes that, even though reported infrastructure damage appears manageable at this stage, market participants remain intensely focused on disruptions to oil flows through this critical chokepoint.
Market Reaction: Brent Futures Stabilize but Remain Volatile
After the initial drop, Brent crude retraced part of its losses as traders reassessed the balance between easing geopolitical tensions and persistent logistical constraints.
“Brent futures also edged up slightly to USD 97/bbl.” The analysts describe the broader price response as muted relative to the severity of earlier fears: “The oil market has reacted with relative calm, suggesting that reported damages may be manageable for now.”
At the same time, sentiment remains highly data-dependent, with positioning tied closely to any indications of changes in physical flows. As Danske notes, “Markets are closely watching for signs of increased traffic through the strait in the coming days.”
Key Oil Market Metrics
| Indicator | Level / Change | Context |
|---|---|---|
| Brent crude price | USD 95/bbl | Level after 14% decline following ceasefire announcement |
| Brent futures | USD 97/bbl | Edged slightly higher as markets reassessed risk |
| Strait of Hormuz status | Blocked | Iran has indicated a possible reopening later this week |
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