Global markets rallied on Wednesday after the United States and Iran agreed to a conditional two-week ceasefire tied to the reopening of the Strait of Hormuz, one of the world’s most important energy chokepoints. The deal pushed oil sharply lower and lifted Asian shares as traders priced in a partial return of supply through the Gulf.

The move matters well beyond the Middle East. The Strait of Hormuz carries more than a quarter of global seaborne oil trade and about one-fifth of world oil consumption, according to the US Energy Information Administration. The International Energy Agency says Asian economies are especially exposed because much of the crude moving through the strait is bound for Asia.

Markets rebound after the ceasefire deal

Oil prices plunge on US-Iran ceasefire was the dominant market story early on 8 April. AP reported that US crude fell below $100 a barrel, while Brent also dropped sharply as investors reacted to the two-week truce and the prospect of safer passage through Hormuz. Asian markets rose strongly, with gains in Tokyo, Seoul and Hong Kong.

According to the supplied BBC report, Brent crude had been trading at about $70 a barrel before the conflict began on 28 February, underlining how much risk remains in the market despite Wednesday’s relief rally. The same report said President Donald Trump agreed to suspend attacks for two weeks if Iran ensured the “complete, immediate, and safe” opening of the strait, while Iranian Foreign Minister Abbas Araghchi said safe passage “will be possible” if attacks stop.

Damage to supply may outlast the truce

Even so, oil prices plunge on US-Iran ceasefire may not mark a full return to normal. Analysts cited by the supplied report warned that shipping can resume faster than production, especially where energy infrastructure has been damaged. Rystad Energy estimated in late March that repair and restoration costs across the region could reach at least $25 billion.

That longer-term risk matters for fuel-importing countries. The Philippine government declared a national energy emergency in late March because the conflict threatened supply stability and pushed up global oil prices. That shows how quickly a Gulf disruption can spread to import-dependent economies.

Responses and next steps

Washington and Tehran have presented the ceasefire as conditional and temporary, not a final peace settlement. Markets welcomed the pause, but the next test will be whether ships move through Hormuz consistently and whether negotiations turn the two-week truce into something more durable. Until then, oil prices plunge on US-Iran ceasefire remains a relief story, not yet a resolution.