Oil prices rise as U.S., Iran agree to halt attacks in Hormuz

U.S. crude rose to $69.52 a barrel and Brent held near $71.90 in the latest session after the United States and Iran agreed to halt recent hostilities in the Gulf and reopen talks over the Strait of Hormuz, a chokepoint that carries a large share of global oil and gas. A U.S. official: “Both sides will stand down for now and vessels can move freely.”

The agreement was tied to a 14-point memorandum of understanding reached on June 17, with technical talks set to resume in Qatar on Tuesday. The arrangement included 60 days of toll-free shipping in the strait.

An Iranian projectile hit a cargo vessel in the Strait of Hormuz on Thursday, then Iran launched missiles and drones at U.S. military sites in Kuwait and Bahrain early Sunday after the June 17 interim ceasefire came under pressure. President Donald Trump warned Iran could face devastating consequences if it did not honor the agreement.

Disruption in the Strait of Hormuz produced the largest oil market shock in history, with Brent up about 65 percent by the end of March and global oil supply down 10.1 million barrels a day in March, the World Bank said. Prices could fall further if the strait reopens, but Goldman Sachs warned they may not return to pre-war levels quickly because inventories remain low and the route may not fully normalize.