Oil Drops 8% After Trump Delays Hormuz Deadline Warning

Brent Crude Prices Plunge Following U.S.-Iran Talks

Brent crude experienced a sharp decline of over 8% shortly after U.S. President Donald Trump announced that the United States and Iran had engaged in constructive discussions over the past two days, aiming for a comprehensive resolution to their ongoing conflict in the Middle East.

During early Monday trading, Brent crude dropped to approximately $103, while WTI slipped to near $90.

Despite these developments, Iranian news outlets reported that there had been no direct or indirect communication with President Trump.

Shifting Dynamics in the Strait of Hormuz

As the deadline set by President Trump for reopening the Strait of Hormuz approaches, Iran’s Islamic Revolutionary Guard Corps (IRGC) appears to have softened its stance, reducing previous threats against civilian infrastructure. This comes amid ongoing tensions that continue to impact global energy markets.

The Strait of Hormuz, which has been largely closed since late February due to U.S. and Israeli military actions against Iran, remains at the center of the crisis. Around one-fifth of the world’s oil and LNG shipments pass through this strategic passage, and the disruption has led to surging crude prices and concerns about a prolonged supply shortage.

IRGC Responds to Infrastructure Attacks

According to regional reports, the IRGC denied targeting desalination plants in Gulf nations, instead accusing U.S. forces of attacking water infrastructure on Iran’s Qeshm Island. The Guards warned that any assault on Iranian power facilities would be considered “inhumane,” emphasizing the potential impact on hospitals, water systems, and essential civilian services.

Nevertheless, Tehran maintains that escalation remains possible. The IRGC reiterated that if the U.S. targets Iranian energy facilities, they would respond by attacking power plants associated with American operations in the region, as well as broader industrial and energy assets.

By Charles Kennedy for Oilprice.com