LONDON, May 6, 2026, 13:02 BST
- Brent crude fell below $100 a barrel after a Pakistani source said the United States and Iran were nearing an initial peace deal.
- Iran’s Revolutionary Guards navy said safe transit through the Strait of Hormuz could resume under new protocols, though it did not spell out the rules.
- Stocks rallied, but shipping risk stayed high after CMA CGM said one of its vessels was attacked in the strait on Tuesday.
Oil prices dropped below $100 a barrel and global shares rose on Wednesday after President Donald Trump paused a U.S. naval operation in the Strait of Hormuz, giving fresh room to talks aimed at ending the war with Iran. The market move sharpened after Iran signalled that safe passage through the waterway could resume, though only under new and still unclear procedures.
The shift matters because Hormuz is not a small shipping lane. Roughly one-fifth of global energy normally moves through the strait, and its near-closure has forced refineries and fuel buyers to run down inventories while traders priced in a wider supply shock.
Brent crude, the global oil benchmark, fell $10.07, or 9.2%, to $99.80 a barrel by 1042 GMT, the first move below $100 since April 22. U.S. West Texas Intermediate, the American crude benchmark, dropped $10.79, or 10.6%, to $91.48, putting both contracts on course for their biggest absolute daily declines in a month.
The reported diplomatic outline is still short of a deal. A Pakistani source involved in mediation said the sides were closing in on a one-page memorandum, while Reuters reported that the White House, State Department and Iranian officials did not immediately respond to requests for comment.
Axios reported, and the Pakistani source confirmed to Reuters, that the draft would start a 30-day negotiation period covering Hormuz, Iran’s nuclear programme and U.S. sanctions. It would include a moratorium on nuclear enrichment — a pause in producing nuclear fuel at higher purity — and steps to release frozen Iranian funds, according to the report.
Trump said he had paused “Project Freedom,” the U.S. effort to guide ships through the strait, for a short period while talks continue. He later said the strait could be “open to all” if Iran accepted the terms, but warned that bombing would resume at greater intensity if it did not. The Guardian
The rally spread beyond energy. Europe’s STOXX 600 rose 2.1%, MSCI’s global equity index hit a fresh record, and S&P 500 futures gained 0.7%. Chris Turner, head of global markets at ING, said equity investors were “jumping on positive-sounding news from the Gulf,” while Rushil Khanna at Ostrum said Asian tech earnings momentum tied to AI capital spending “exceeds anything I have seen.” Reuters
David Morrison, senior market analyst at Trade Nation, said investors were adding a “peace dividend” across markets. He also warned that even if Hormuz reopens, normal shipping and trade flows could take months to restore, a reminder that price relief and supply relief are not the same thing. The Guardian
Iran’s Islamic Revolutionary Guard Corps navy said “safe and stable passage” would be ensured after what it called the end of aggressor threats. A day earlier, Iranian state-backed media said Tehran had set up a new mechanism for vessels crossing Hormuz, warning the U.S. Navy to stay out and saying commercial ships would need to coordinate passage with Iran’s military. The Guardian
Shipping companies still face a dangerous channel. CMA CGM said its San Antonio vessel was attacked on Tuesday while transiting Hormuz, injuring crew and damaging the ship. The French group, the world’s third-largest container line, had said 14 of its vessels were stranded in the Gulf at the start of the war.
The picture was mixed for peers and operators. Maersk said its Farrell Lines vehicle carrier Alliance Fairfax exited the Gulf through Hormuz with U.S. military support, while Crowley-Stena Marine Solutions said the CS Anthem chemical tanker also completed a transit; both were U.S.-flagged vessels.
But the downside case remains live. If negotiations collapse, a U.S. official cited by Axios said Washington could restore the blockade or resume military action, while Secretary of State Marco Rubio said any settlement must address Iran’s remaining highly enriched uranium, material that can be used in nuclear weapons if further processed.
Diplomatic pressure is widening. China’s foreign minister Wang Yi, meeting Iranian Foreign Minister Abbas Araghchi in Beijing, called for a “comprehensive ceasefire” and said dialogue should continue, while Pakistan’s Prime Minister Shehbaz Sharif thanked Trump for pausing the Hormuz operation. Apnews
