U.S.-Iran peace deal restores Hormuz oil flow, calms prices

Key Facts

In a sharp reversal of the conflict, the U.S. and Iran signed an interim peace deal that restored oil flows through the Strait of Hormuz and sent shipping costs plunging, according to reports. Supertanker charter rates for the Saudi Arabia-to-China route fell 44% to $287,000, while 48 vessels transited the strait on Friday, with 75 million barrels flowing from the Persian Gulf since the deal.

The agreement follows weeks of military strikes that drove prices to multi-month lows, but the diplomatic thaw has turned the narrative upside down. Brent crude stabilized below $72 and WTI traded around $69, hovering near pre-war levels. Persian Gulf exports are at about 75% of pre-war levels, with loadings resuming at Saudi Arabia's Ras Tanura terminal.

Traders will focus on deal implementation and its impact on Iranian supply and future sanctions. At the close on May 10, Brent was at $71.80 and WTI at $68.90, with expectations of increased flows. Prices could face further downside if exports continue to return without disruption.