Brent falls below psychological $100 threshold as markets react to Trump signal

Oil prices are falling sharply today after US President Donald Trump signalled a possible deal to end the war with Iran. North Sea Brent crude has thus slipped back below the psychologically important threshold of $100 per barrel. At around 13:00 CEST, it was down by more than ten percent, trading near $98,5 per barrel. US light crude West Texas Intermediate (WTI) was down by more than 12 percent at the same time, falling below $90 per barrel.

Trump announced that the United States was briefly suspending the operation in which it escorted and protected ships threatened by Iran’s blockade in the Strait of Hormuz. He said the move was prompted by highly advanced talks with Iran and efforts to reach a deal.

The White House believes a deal on a one-page memorandum of understanding is within reach, according to Axios, with Tehran’s response on several key points potentially arriving within 48 hours.

According to the outlet, the deal includes a moratorium on Iranian uranium enrichment, the lifting of US sanctions against Tehran and the release of frozen Iranian assets, as well as the resumption of shipping through the Strait of Hormuz.

Shipping through the Strait of Hormuz has been crippled by the conflict in the Middle East, which began in late February with US-Israeli attacks on Iran. Around one-fifth of the world’s oil supplies normally pass through the strait.

The White House chief announced on Sunday the launch of an operation called Project Freedom, aimed at providing military protection for merchant ships passing through the Strait of Hormuz. On Tuesday evening US time (early this morning CEST), however, Trump said on his Truth Social platform that “at the request of Pakistan and other countries” and also “based on the fact that great progress has been made toward a complete and final agreement with representatives of Iran,” Project Freedom would be “paused briefly to see whether the agreement can be completed and signed or not.”

Oil prices in dollars per barrel (about 159 litres)