Key Takeaways

• Oil edges lower: Brent fell 0.5% to $82.75 per barrel, while WTI dipped 0.3% to $80.54 — consolidating near Monday’s 5% crash.
• Both at March lows: Monday’s sharp selloff erased much of the geopolitical risk premium built up during the Gulf conflict.
• MOU details: Trump’s interim deal extends the April ceasefire by 60 days and includes reopening the Strait of Hormuz.
• Geneva signing Friday: U.S. and Iranian officials will attend a formal ceremony to sign the deal.
• Trump: “Ships are moving”: The president posted that oil-laden vessels were already transiting the “Southern Highway,” describing it as “totally safe, secure, and pristine.”
• Implementation timeline uncertain: Markets are focused on how quickly oil exports can normalize — analysts say weeks or months.
• Maritime risks linger: Questions remain over shipping security, insurance costs, and the pace of vessel re-mobilization.
• Inventory drawdown a concern: Stockpiles were significantly depleted during the Hormuz closure; any deal setbacks could reignite supply volatility.
• OPEC cuts demand forecast: The producer group lowered its 2026 global demand growth estimate for a second straight month to 970,000 barrels per day — down from 1.17 million.
• Analysts urge caution: Despite the positive market reaction, several institutions warn against assuming a rapid return to normalcy.

Oil prices edged lower on Tuesday after plunging to three-month lows in the previous session, as investors awaited further details on a U.S.-Iran agreement expected to reopen the Strait of Hormuz.

At 02:46 ET (06:46 GMT), Brent oil futures expiring in August fell 0.5% to $82.75 a barrel. U.S. West Texas Intermediate crude futures expiring in July edged down 0.3% to $80.54 a barrel.

Both benchmarks had tumbled nearly 5% on Monday after U.S. President Donald Trump announced an interim agreement with Iran that would extend a ceasefire announced in April by another 60 days and reopen the Strait of Hormuz.

The sharp selloff erased much of the geopolitical risk premium that had accumulated during the Gulf conflict, with Brent and WTI settling at their lowest levels since March.

Trump Says Ships Are Moving

Markets are now focused on the timing of the agreement’s implementation and how quickly oil exports can return to normal levels.

Trump said in a social media post that ships loaded with oil were starting to move out of the strait. “They are going along the Southern ‘Highway,’ which is totally safe, secure, and pristine. There are other areas of travel, also!!!” Trump wrote.

U.S. and Iranian officials will attend a formal deal signing ceremony in Geneva on Friday.

Full Recovery Could Take Months

Analysts said uncertainty remains despite the broadly positive market reaction. While the deal has raised hopes that disrupted energy flows will resume, questions linger over maritime security, insurance costs, and the pace at which stranded vessels can return to service.

Several institutions have cautioned that restoring inventories and normalizing shipping routes could take weeks or even months.

Oil cartel OPEC last week lowered its forecast for global oil demand growth in 2026 for a second consecutive month, citing weaker consumption prospects. The producer group now expects demand to grow by about 970,000 barrels per day, down from a previous forecast of 1.17 million barrels per day.

Inventories have been drawn down significantly during the strait’s closure, and any setbacks in negotiations or delays in reopening could reignite supply concerns and volatility across energy markets.