WTI tumbles 5% on renewed hopes of the Strait of Hormuz reopening

West Texas Intermediate (WTI) – the US oil benchmark – has witnessed a steep bearish opening gap on Monday, now losing nearly 5%, on its way to surrendering the $90 threshold.

The sell-off in the black gold is fuelled by the renewed optimism over a likely reopening of the Strait of Hormuz, which could ease the supply concerns.

The ongoing peace talks between the United States (US) and Iran have revived hopes for a potential peace agreement to be reached in the coming hours.

Despite the optimism, US President Donald Trump’s comments on Sunday suggest that both sides still have some differences, with markets eagerly awaiting further details.

“It isn’t even fully negotiated yet. So don’t listen to the losers, who are critical about something they know nothing about,” Trump posted on Truth Social.

Meanwhile, US Secretary of State Marco Rubio told the New York Times an agreement with Iran had garnered regional support, but a nuclear deal couldn’t be achieved “in 72 hours on the back of a napkin”.

Looking ahead, it remains to be seen if WTI extends its downtrend as markets pay close attention to the evolving US-Iran peace deal and fresh insights into the likely reopening of the Strait.