Ethiopian Business Review

Oil prices drop as Trump announces US-Iran Peace deal #EBR_News Jun 15, 2026 Oil prices fell sharply on Monday after the United States and Iran reached a peace agreement that is expected to reopen the Strait of Hormuz, one of the world's most important energy shipping corridors, easing fears of prolonged disruptions to global oil supplies. Brent crude, the international benchmark, declined by nearly four percent to around USD 84 per barrel in early trading, while U.S. crude dropped more than four percent to approximately USD 81 per barrel as investors responded positively to signs that energy exports from the Gulf could soon normalize. The agreement follows more than three months of conflict that disrupted shipping through the Strait of Hormuz, a narrow waterway connecting the Persian Gulf to international markets. The route typically carries about one-fifth of global oil and natural gas supplies, making it one of the most strategically important energy corridors in the world. According to reports, the draft agreement includes the lifting of the U.S. naval blockade and the reopening of the Strait of Hormuz within 30 days. Pakistan, which has reportedly played a role in facilitating the negotiations, indicated that the formal agreement is expected to be signed in Switzerland later this week. U.S. President Donald Trump welcomed the development, saying the deal would help restore stability to the region and ensure the uninterrupted flow of energy supplies. Financial markets reacted positively to the announcement. Major Asian stock markets posted gains as lower oil prices reduced concerns over inflation and rising energy costs. Analysts said the decline in crude prices could ease pressure on central banks that have been struggling to balance inflation risks against slowing economic growth. "The decline in oil prices could prove sustainable if the agreement removes major barriers to global trade and energy flows," several market analysts noted following the announcement. The price decrease is a major relief for Ethiopia, which imports almost all of its refined petroleum products. During the conflict, disruptions slashed the country's daily diesel supply by half to approximately 4.5 million litres, forced the government to import fuel at higher prices through special procurement arrangements, and added billions of birr to the monthly fuel subsidy bill. Retail fuel prices were revised upward for the first time since December 2025, with diesel rising by 10 birr per litre. The conflict had pushed energy prices higher since February, raising concerns about fuel costs, transport expenses, and inflation across both developed and emerging economies. Countries heavily dependent on imported fuel had been particularly exposed to the volatility. However, investors largely interpreted the deal as a significant step toward restoring stability in one of the world's most critical energy-producing regions. If fully implemented, the agreement could mark one of the most significant geopolitical developments affecting global energy markets this year. Follow EBR for the latest business news, trends, and expert analysis: Telegram (https://t.me/ebr_news) Facebook (https://bit.ly/3OodjMF) LinkedIn (https://lnkd.in/eAVk65Xv) WhatsApp (https://bit.ly/4tH4NIR)