Oil prices plunged Friday after Iran’s Foreign Minister Abbas Araghchi said the vital Strait of Hormuz was “completely open” for commercial tankers and cargo ships during the US-Iran ceasefire.

International benchmark Brent North Sea crude plunged 10 per cent to $89.11 a barrel, after earlier falling five percent on US-Iran peace deal hopes. The main US contract, West Texas Intermediate, shed 11 per cent to $84.11 a barrel.

The sharp decline follows a conditional two-week ceasefire agreement between the United States and Iran announced earlier in April 2026, which is contingent on the safe reopening of the Strait of Hormuz — a critical chokepoint carrying about 20 per cent of global oil and LNG shipments. The waterway had been largely blocked since the escalation of conflict in March, causing one of the biggest supply disruptions in oil market history and pushing prices significantly higher beforehand.

Iranian Foreign Minister Abbas Araghchi had earlier stated that safe passage through the strait would be possible for two weeks under coordination with Iranian armed forces, subject to the halt of attacks on Iran. Recent statements on Friday reinforced that the strait is now declared completely open for commercial vessels during the ceasefire period, though uncertainties remain regarding the US blockade and long-term management.

Market analysts noted that while the announcement triggered immediate relief selling, prices remain elevated compared to pre-conflict levels due to lingering concerns over the fragility of the truce, ongoing technical limitations, and partial recovery in tanker traffic. Brent crude has traded volatilely in the $94-$99 range in recent sessions before Friday’s drop, with global stocks rallying on de-escalation hopes.

The development comes as both sides navigate a fragile peace framework, with the ceasefire aimed at allowing time for further negotiations while enabling resumed oil flows that could ease global energy pressures.