Global Economy — 2026-04-08
Oil Plunges 16% and Global Markets Surge as US-Iran Ceasefire Eases Hormuz Fears
Benchmark US crude fell $18.43 to $94.52 per barrel, a nearly 16% decline, on the US-Iran ceasefire announcement and prospect of Hormuz reopening. Brent crude stabilized around $95.51. European and Asian equity markets surged, with the Prague bourse posting its strongest session in over a month. The rally reflected expectations that tankers trapped in the Persian Gulf could finally transit the 21-mile strait. Markets remain cautious given the ceasefire's two-week duration and unresolved terms.
Oil settling at $94-95, still 35% above the pre-war baseline of ~$70, indicates markets are pricing the ceasefire as fragile and the Hormuz reopening as conditional. The two-week duration caps the relief rally. A ceasefire collapse would likely produce a sharper spike than the initial Hormuz closure, as inventories have been drawn down during the 40-day crisis.