Global crude oil prices plunged sharply after touching record highs earlier in the day, as U.S. President Donald Trump indicated that the ongoing war with Iran could soon come to an end.
According to market data, crude prices had surged to around $119 per barrel earlier in the session, driven by fears of severe supply disruptions in the Middle East amid escalating tensions between the United States and Iran. However, prices later fell to around $83.93 per barrel, marking a decline of roughly $35 or nearly 29% from the day’s peak.
The sharp correction came after Trump suggested in an interview that the conflict was nearing its conclusion. The U.S. president said the war was “pretty much complete,” signalling that military objectives may already have been achieved and raising hopes of a quicker-than-expected de-escalation.
Oil markets had earlier reacted strongly to the geopolitical risks surrounding the conflict. Brent crude had briefly surged to about $119.50 per barrel, its highest level in years, as traders priced in the possibility of prolonged disruptions to energy supply routes in the Middle East.
The rally was largely driven by concerns over the security of the Strait of Hormuz, a crucial maritime chokepoint through which roughly 20% of the world’s oil supply normally passes. Any disruption to tanker movement through the strait can significantly affect global energy markets and trigger price spikes.
However, sentiment shifted quickly after Trump’s remarks suggested that the conflict may not last as long as initially feared. Reports also indicated that oil prices dropped sharply following the comments, easing some of the geopolitical risk premium that had been built into crude prices during the conflict.
The rapid decline highlights how sensitive commodity markets remain to developments in geopolitical conflicts. Oil prices have been extremely volatile since the outbreak of the Iran war, which disrupted regional energy infrastructure, shipping routes and production across several Middle Eastern countries.
Analysts say that while the war initially triggered one of the biggest short-term oil rallies in recent years, markets are now reassessing supply risks as expectations grow that tensions could ease sooner than anticipated.
Despite the sharp fall from intraday highs, crude prices remain significantly elevated compared with levels before the conflict began, reflecting the continued uncertainty around the geopolitical situation and global energy supply chains.
Energy markets are likely to remain volatile in the near term as traders closely monitor developments in the Middle East, particularly around shipping through the Strait of Hormuz and further statements from the U.S. administration regarding the conflict.
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