Oil futures tumbled on Wednesday, but risks of a continued energy shock lingered after Iran’s semi-official Tasnim news agency said the regime was halting all traffic through the Strait of Hormuz after Israel continued its military campaign in Lebanon.
In a post on Wednesday, an X account understood to be close to the regime said, “If the Israeli regime does not commit to a ceasefire in Lebanon, the war will resume within a few hours.”
At the same time, Iranian leaders reportedly said they are still willing to meet with the US, even if the regime chooses to block the strait in response to Israel’s action in Lebanon, Bloomberg reported.
The threats of resumed violence from Iran came less than 24 hours after President Trump announced in a Truth Social post Tuesday evening that the US military was suspending a wide-ranging bombing campaign on Iran to allow for a two-week ceasefire in the war that has roiled global markets.
“I agree to suspend the bombing and attack of Iran for a period of two weeks,” Trump wrote, roughly an hour and a half ahead of his 8 p.m. ET deadline, “This will be a double sided CEASEFIRE! The reason for doing so is that we have already met and exceeded all Military objectives, and are very far along with a definitive Agreement concerning Longterm PEACE with Iran, and PEACE in the Middle East.”
Iran’s foreign minister, Abbas Araghchi, confirmed its acceptance of the temporary truce in a statement shortly after Trump’s post. Araghchi said that if attacks on Iran are halted, its own operations would cease and that “for a period of two weeks, safe passage through the Strait of Hormuz will be possible via coordination with Iran’s Armed Forces.”
Data from maritime intelligence provider Huax shows that traffic through the strait remains essentially unchanged from levels shortly before the ceasefire was announced, the firm told Yahoo Finance.
Futures on Brent crude (BZ=F), the international benchmark, fell 13% to trade above $95 a barrel on Wednesday morning following deeper losses. Futures on the US benchmark, West Texas Intermediate (WTI) crude (CL=F), dropped 15% to change hands around $95 a barrel.
Stocks also soared on the news. The S&P 500 (^GSPC) surged by 2.1%, while the Dow Jones Industrial Average (^DJI) rose 2.3%, or more than 1,000 points. The tech-heavy Nasdaq Composite (^IXIC) gained 2.5%.
Read more: What an extended war with Iran could mean for gas prices
While the two-week ceasefire is underway, the Strait of Hormuz, through which 20% of the world’s oil supply passes, remains a point of contention.
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“Based on conversations with Prime Minister Shehbaz Sharif and Field Marshal Asim Munir, of Pakistan, and wherein they requested that I hold off the destructive force being sent tonight to Iran, and subject to the Islamic Republic of Iran agreeing to the COMPLETE, IMMEDIATE, and SAFE OPENING of the Strait of Hormuz,” Trump wrote.
He added that the US received a “10 point proposal from Iran, and [believes] it is a workable basis on which to negotiate,” bringing this long-term problem “close to resolution.”
After Trump announced the ceasefire, US officials confirmed that the US halted attacks against Iran, while Iran’s Araghchi said his country would “cease their defensive operation,” according to the New York Times.
However, reports of attacks within Iran on the Lavan oil refinery, and retaliatory strikes in the UAE and Kuwait, were reported in regional media and by governments within the affected countries through Wednesday morning.
In an X post on Wednesday, Pakistan’s prime minister, Shehbaz Sharif, called for both sides to honor the ceasefire, writing, “Violations of the ceasefire have been reported at a few places across the conflict zone, which undermine the spirit of the peace process. I earnestly and sincerely urge all parties to exercise restraint and respect the ceasefire for two weeks, as agreed upon, so that diplomacy can take a lead role towards peaceful settlement of the conflict.”
The ceasefire and subsequent negotiations come after Trump’s post to Truth Social Tuesday morning, where he wrote, “A whole civilization will die tonight, never to be brought back again. I don’t want that to happen, but it probably will.”
The president also wrote, in what some took as an opening for potential negotiations preempting the strikes, “Now that we have Complete and Total Regime Change, where different, smarter, and less radicalized minds prevail, maybe something revolutionarily wonderful can happen, WHO KNOWS?”
Prior to this evening, Iran’s leadership on Tuesday left negotiation talks and was unwilling to discuss a temporary ceasefire, the New York Times reported, looking only for a full end to the war and the payment of reparations for damages, among other conditions.
While the US and Israeli militaries have struck a large range of primarily military and energy infrastructure targets within Iran through the course of the war, the US has so far refrained from striking domestic power plants, bridges, and desalination plants that provide critical services to noncombatant civilians within the country.
An excavator removes rubble at the site of a strike that, according to a security official at the scene, destroyed half of the Khorasaniha Synagogue and nearby residential buildings in Tehran, Iran, Tuesday, April 7, 2026. (AP Photo/Francisco Seco) · ASSOCIATED PRESS
Trump pressed the Tuesday night deadline he imposed for Iran to make a deal in posts throughout the weekend and at the Monday press conference.
“After that, they’re going to have no bridges, they’re going to have no power plants — Stone Ages,” Trump said during Monday’s press conference.
Jake Conley is a breaking news reporter covering US equities for Yahoo Finance. Follow him on X at @byjakeconley or email him at jake.conley@yahooinc.com.
Brooke DiPalma is a senior reporter for Yahoo Finance. Follow her on X at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.
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