Oil Crashes 18% as Trump, Iran Agree to Two-Week Ceasefire
A last-minute ceasefire between the U.S. and Iran sent oil prices crashing 18 percent, reopening the Strait of Hormuz after 39 days of war — but experts warn the truce is fragile.
With less than two hours before President Trump's threatened military escalation, a ceasefire broke — and the world's oil markets convulsed. Trump announced a two-week pause in hostilities with Iran on April 7, just moments before his 8 p.m. ET deadline to unleash what he had promised would be "destructive force" against Tehran. Oil prices immediately crashed 18 percent.
Trump posted on Truth Social at approximately 5:30 p.m. ET that he would suspend attacks "subject to the Islamic Republic of Iran agreeing to the COMPLETE, IMMEDIATE, and SAFE OPENING of the Strait of Hormuz." He credited Pakistani Prime Minister Shehbaz Sharif and Army Chief Field Marshal Asim Munir with requesting the pause.
The markets moved before diplomats could draw breath. Within 30 minutes, West Texas Intermediate crude plunged from approximately $107 to under $100, dropping over 18 percent to approximately $92. Brent crude fell to $93 per barrel — below the $100 threshold for the first time in weeks. The stakes behind those numbers are enormous: the Strait of Hormuz carries 20 percent of global oil supplies.
Iranian Foreign Minister Abbas Araghchi confirmed acceptance within minutes. "If attacks against Iran are halted, our Powerful Armed Forces will cease their defensive operations," Araghchi stated. "For a period of two weeks, safe passage through the Strait of Hormuz will be possible via coordination with Iran's Armed Forces."
The ceasefire delivered a critical strategic win for the United States without committing ground forces. After 39 days of escalating conflict that killed 13 American service members and wounded nearly 300, Trump's maximum pressure approach forced Iran to reopen the global energy chokepoint it had blockaded. The human cost of that pressure, on all sides, has been severe.
Israel's office backed the ceasefire but drew a sharp line: "The two-week ceasefire does not include Lebanon." Even as hostilities pause elsewhere, a separate front remains alive.
Pakistan's emergence as the pivotal mediator reshaped the diplomatic picture. Prime Minister Sharif posted on X requesting a two-week extension from Trump and separately asked Iran to open Hormuz as a "goodwill gesture." Sharif announced he would invite delegations to Islamabad on April 10 "to further negotiate for a conclusive agreement to settle all disputes" — a signal that the real work is only beginning.
Trump, for his part, expressed measured confidence in what Iran put on the table. He said he received "a 10-point proposal from Iran, and believe it is a workable basis on which to negotiate. Almost all of the various points of past contention have been agreed to between the United States and Iran."
Iran's 10-point plan is sweeping in scope. It demands a U.S. commitment to no further aggression, continued Iranian control of the strait, acceptance of Iran's nuclear enrichment rights, the lifting of all primary and secondary sanctions, termination of UN Security Council and IAEA resolutions, payment of damages for war losses, withdrawal of U.S. combat forces from the region, and a full cessation of hostilities — including in Lebanon.
Tehran also secured an economic foothold in any deal. Iran and Oman will charge approximately $2 million per vessel for passage through the strait, with funds directed toward reconstruction — a provision that underscores Iran's insistence on maintaining operational control over the waterway even as it reopens to global shipping.
The human toll behind the diplomacy staggers. Beyond the 13 U.S. service members killed, Human Rights Activists in Iran reported 3,530 dead, including 1,606 civilians. Israeli authorities counted 19 killed by missile fire and 11 soldiers killed in Lebanon. Lebanon recorded over 1,500 dead and 1.2 million displaced — families scattered across a country already broken before the war began.
Iran's Supreme National Security Council paired its acceptance with a pointed warning. "It is emphasised that this does not signify the termination of the war," the council declared. "Our hands remain upon the trigger, and should the slightest error be committed by the enemy, it shall be met with full force." Tehran wants the world to know it is pausing — not surrendering.
Analysts are watching the next two weeks with skepticism. Michael Wan, senior currency analyst at MUFG, argued that a durable deal would be difficult to achieve given that Iran's demands "seem hard for different parties, including Israel and the Gulf states, to accept."
"As such, we think any agreement on paper will likely be an extremely unstable equilibrium," Wan stated. "We think further meaningful bouts of volatility are more likely than not moving forward."
Not every expert foresaw collapse. Alex Vatanka, director of the Iran Program at the Middle East Institute, offered a more cautious read. "They're talking in a way that you at least have the ability to agree on a basic framework that you then have to build on," Vatanka said. "You have a window here to prevent disaster — and we were very close to it."
The conflict drew in the broader Gulf. The United Arab Emirates, Kuwait, Oman, Saudi Arabia and Bahrain collectively suffered 24 casualties. The war itself began Feb. 28 with coordinated U.S.-Israeli strikes that killed Supreme Leader Ayatollah Ali Khamenei and dozens of senior Iranian officials, setting off the chain of escalations that culminated in last night's ceasefire.
Negotiations open April 10 in Islamabad. The two-week window is a working hypothesis — if it holds, a durable settlement becomes possible; if it breaks, military officials warn the war would resume with greater intensity than anything seen so far. Trump's maximum pressure strategy forced concrete concessions without a ground war, but Iran secured transit revenue and retained operational control over the world's most critical energy chokepoint. That unresolved tension — American strategic reach versus Iranian regional grip — arrives in Islamabad Thursday, and the world will be watching.