NEW YORK – Oil prices tumbled Sunday after President Donald Trump said he would direct U.S. forces to pause any new strikes on Iran, saying a deal to halt the Middle East fighting appeared close.
An end to the more than five-month conflict could reopen a critical path for oil shippers, allowing vessels carrying crude and other products to leave the Persian Gulf after being caught up in the disruption caused by the fighting.
U.S. crude dropped 5% to $80.79 a barrel Sunday night, while Brent crude, the global benchmark, also slid 5% to $83.87 a barrel.
The oil market has been volatile since the U.S. and Israel began strikes on Iran in late February, with prices climbing above $100 a barrel several times during the spring.
As the fighting dragged on, elevated crude prices filtered through the broader economy, raising the cost of gasoline, jet fuel and goods transported by diesel-powered fleets. Drivers paid more at gas stations, air travelers faced higher fares tied to jet fuel costs, and some countries saw fuel shortages severe enough to trigger rationing and occasional closures of schools and government offices.
Oil and gas companies, meanwhile, reported surging profits in the spring as prices for crude, gasoline and diesel climbed. The gains were driven in part by shipping bottlenecks around the Strait of Hormuz, the narrow waterway bordering Iran that serves as a crucial route for petroleum shipments and was disrupted by the conflict.
Even after Sunday night’s decline, U.S. crude prices remained roughly 20% above where they stood before the conflict began.
