U.S. West Texas Intermediate crude plummeted by nearly $20 per barrel on Wednesday after President Donald Trump announced a two-week ceasefire with Iran. The agreement is contingent on the immediate and safe reopening of the Strait of Hormuz.
WTI crude for May delivery fell $18.10, or 16.02 percent, to $94.85 per barrel. This development follows a period of significant tension, including threats of widespread attacks on Iranian civilian infrastructure if the Strait of Hormuz, through which 20 percent of the world's oil transits, was not opened.
Iran stated it would halt attacks if reciprocal actions were taken, allowing for safe transit through the Strait for two weeks. This announcement comes after a period that saw the steepest monthly oil price rise in history in March. President Trump indicated that a 10-point proposal from Iran provides a workable basis for negotiation, suggesting progress towards a long-term peace agreement.