- The United States sends a peace plan to Iran and signals of de-escalation appear.
- Iran says “non-hostile” ships can pass through Hormuz.
- West Texas Intermediate was down 5.01% at $87.72.
Brent crude oil, the global market benchmark, fell nearly 6% on Wednesday after US President Donald Trump sent a peace plan to Iran.
Around 00:30 GMT, a barrel of Brent was down 5.92% at $98.30. The benchmark US oil contract, West Texas Intermediate, fell 5.01% to $87.72.
In Asian markets, Japan’s Nikkei index and South Korea’s Kospi rose more than 3%.
Trump sent a peace plan to Iran as he expressed optimism Tuesday that nearly a month of war would end, with Tehran announcing it would allow “non-hostile” oil ships through the crucial Strait of Hormuz.
The first signs of a diplomatic solution have emerged despite fresh violence, with an Iranian missile causing injuries in Israel, which in turn has put pressure on several fronts and vowed to take control of a swathe of southern Lebanon.
The fall in oil prices on Wednesday came after prices rose the day before, with traders cautious about the prospect of a negotiated deal to end the war.
Trump, whose statements in recent days have oscillated between promising massive attacks on Iran and declaring an end to the nearly month-long war, said the United States was “in negotiations right now” with Iran, which has not confirmed any formal discussions.
“They did something incredible yesterday, actually. They gave us a gift, and the gift arrived today. And it was a very big gift worth an enormous amount of money,” Trump told reporters in the Oval Office.
“That meant one thing to me: We’re dealing with the right people.”
He offered no further explanation, but said it concerned the Strait of Hormuz, which Iran has largely blocked in retaliation for U.S. and Israeli strikes, sending global energy prices soaring.
Iran, in a message broadcast shortly after by the International Maritime Organization, assured safe passage to “non-hostile ships” using the strait, the gateway to a fifth of the world’s oil.
Iran had already said in recent days that it was not targeting friendly nations, although many ships have hesitated because insurance companies refuse to take risks.
