Oil prices fall after U.S.-Iran provisional deal opens Strait of Hormuz
Oil prices dropped following a provisional peace agreement between the United States and Iran that would reopen the Strait of Hormuz. The deal follows three months of disrupted shipping that raised U.S. gasoline prices above $4 per gallon.
The IndependentOil prices fell in the hours after the United States and Iran reached a provisional peace deal that would reopen the Strait of Hormuz to shipping. The agreement followed three months of halted tanker traffic through the waterway, which carries 20 percent of global oil supply.
Gasoline prices had risen from an average of $2.98 per gallon two days before the conflict began to more than $4 per gallon by early April.
Price outlook Patrick DeHaan, head petroleum analyst at GasBuddy, wrote on X that the national average could fall below $3.75 per gallon by July 4 if the agreement holds and traffic resumes. He added that the next few days will determine whether the deal remains in place.
DeHaan also noted that any changes to the agreement in coming weeks could reverse recent price declines. "The next several weeks will be key – one major slip up could impact greatly prices moving forward," he wrote.
Additional supply risks Energy pricing service Opis stated that hurricane-related refinery disruptions on the Gulf Coast can create further volatility in gasoline and diesel prices. The service noted that storms can affect both supply and demand for fuel. U.S. consumers have paid $59 billion more for gasoline since February 28 than they paid during the same period in 2025.
