WTI and Brent crude oil prices crashed on Hyperliquid after President Donald Trump announced that the US and Iran had reached an agreement to reopen the Strait of Hormuz. The West Texas Intermediate plunged to $89, while Brent, the global benchmark, plunged to $93.
Trump announces deal to reopen Strait of Hormuz
Most market participants were expecting the United States to launch a major attack against Iran this weekend. Odds of an attack rose after Trump anounced that he would miss his son’s wedding and remain in Washington.
Another reason why the odds of an attack were high is that this is a long weekend in the United States and the UK, meaning that the markets will be closed for longer.
Instead, Trump announced that the US had reached a deal to reopen the Strait of Hormuz, with details of the deal expected shortly. In a Truth Social post, Trump said that he had talked with Gulf leaders and Israel’s Benjamin Netanyahu.
Trump has been seeking to launch a limited attack against Iran recently, but Gulf allies have rejected, arguing that Iran would attack their oil infrastructure. These countries also argue that reopening the Strait will need a negotiated agreement instead of a war.
Trump’s decision to reach a deal also came after the Iranians made some major threats. For one, they threatened that they would expand their response to other places away from the Middle East. They threatened to close the Bab al-Mandab, where 12% of all of the world’s oil passes through.
Also, they warned that they would attack critical oil infrastructure in the region, a move that would push energy prices higher.
Trump is in a box that is hard to get out
Trump really wants to get out of the war, something that Netanyahu rejects. For one, his approval rating has plunged recently, while US inflationhas jumped to the highest point in years. The headline Consumer Price Index (CPI) rose to 3.8%, while the Producer Price Index (PPI) rose to 6%.
Also, there are mid-term elections, in which the Republican Party is set to lose badly. That will lead to impeachment hearings, which could push him out of office before the term ends.
Still, any deal he inks with the Iranians will be weaker than one he had negotiated before the war started. For example, it will include ending his blockade against Iranian ports and removing some of the US sanctions, a move that will net them billions of dollars.
Brent crude oil price technical analysis
Crude oil prices ended last week above $100 as investors waited for a US attack against Iran. With the main energy markets closed, traders turned to Hyperliquid and other RWA platforms that offer these contracts.
The daily chart shows that Brent crashed on Polymarket and was trading at $93. This happened as traders anticipated more oil flows through the Strait of Hormuz.
It has formed a double-top pattern at $113 and a neckline at $83, its lowest point in March. Also, it has moved below the 50-day moving average, a sign that bears have prevailed.
Therefore, the price will likely remain under pressure in the near term, potentially moving below $90. However, the situation is still fluid and the energy markets will likely be volatile.
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