Oil drops more than 3% as Israel-Lebanon truce lifts Iran deal hopes
Why it matters: A Hormuz reopening would ease a major threat to nearly a fifth of global crude flows and inflation fears.
Oil prices fell after Israel and Lebanon agreed to a conditional ceasefire, raising hopes that Washington and Tehran could extend their truce and reopen the Strait of Hormuz. US crude settled above $93 a barrel after dropping more than 3%, while Brent traded below $97 in earlier Thursday dealings. The key waterway remains effectively shut despite the market reaction, and clashes have continued, with Hezbollah rejecting the US-brokered truce and Iran reporting no recent progress in talks. Before the war, roughly one-fifth of global crude moved through Hormuz, so the disruption has pushed up energy costs and revived concerns about inflation and slower economic growth.