President Donald Trump announced a two-week ceasefire with Iran on Tuesday, extending negotiations to end the war if the country agrees to reopen the Strait of Hormuz.
The agreement was reached at the last minute, just before 2 a.m. Polish time, the deadline set by Trump on Tuesday morning. He then threatened that “the entire civilization will perish that night and will never be rebuilt” if the Iranian government does not open the Strait of Hormuz, because it is a key waterway between Iran and Oman through which a significant part of the world's oil and gas supplies flow.
Here's how experts in finance, business, foreign policy and politics have reacted to what we know so far. ““Euphoria” is the last word that can be used to describe their statements.
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Andrew Bishop
Andrew Bishop, head of global policy research at Signum Global Advisors, wrote in a memo sent to Business Insider that “At this point, our baseline scenario assumes that President Trump is buying time before a major offensive rather than 'sincerely' agreeing to end the war on Iran's terms.”
Bishop added that the company he represents is taking this stance because its members believe it is more likely that Trump wanted to de-escalate the conflict and calm markets rather than suddenly feel “comfortable” with the idea that Iran would have long-term veto power over the operation of the Strait of Hormuz.
“Whether this is indeed the case will determine whether today marks the beginning of the end of the war or merely a delay before further escalation,” Bishop wrote.
See also: “We may not get another warning.” Here's a behind-the-scenes look at the NATO mission
Patrick DeHaan
De Haan, head of fuel market analysis at GasBuddy, wrote on Bluesky that based on the current market situation “Gasoline prices may start to fall nationwide [USA — red.] within about 48 hours – by a few cents a day.”
Fuel prices have surged in the last month as the war triggered the biggest-ever supply shock in the global oil market.
“Diesel prices may react a bit more slowly – but in the current environment they no longer seem likely to reach record levels,” De Haan wrote. “The national average price of gasoline could drop below $4 in about 1-2 weeks, and diesel above $5 in 6-8 weeks.”
“The coming days will bring volatility as the US, Iran and other parties negotiate.” – he added in the next entry. “Iran has signaled safe passage through the strait for two weeks. For now, oil prices are falling significantly, which may cause fuel price increases to slow down in the next 48 hours and then begin to decline.”
Joe Kent
Joe Kent, former director of the US National Counterterrorism Center who resigned in March to oppose war with Iran, made the comments on Tuesday evening in a video on Platform X.
He said that For a ceasefire to be effective, it is “absolutely crucial” that the US withdraws its offensive military support for Israelto prevent further attacks on Iran and violations of the terms of the agreement.
Kent said the US is “on the verge” of solving the war-induced energy crisis. However, he emphasized that Israel's strategic goal of overthrowing the Iranian government “works against” U.S. peace efforts.
“We must understand that there is currently no military solution to this conflict,” he said.
He added that US military actions so far have destabilized the region, strengthened the Iranian government and threatened energy security.
June Goh
While market participants may welcome the resumption of ship traffic through the Strait of Hormuz, what happens next will be key.
The important question is: “which ships will return to load new cargo and take it out?” — as June Goh, senior oil analyst at Sparta Commodities, wrote on X.
She added that a two-week ceasefire was probably too short a period to lead to a lasting rebound in ship traffic.
Despite fluctuations in oil futures prices, the difference between “paper” and real prices is growing.
The benchmark price of physical Dated Brent crude oil, estimated by S&P Global, rose to its highest level since 2008, indicating a tight supply situation in the real market.
See also: Historical oil prices. Experts warn against panic
“Watch the physical market” – wrote Goh.
Michael Wan
Michael Wan, senior currency analyst at MUFG, warned that reaching a lasting agreement could be difficult because Iran's demands “seem difficult to accept for various parties, including Israel and the Gulf states.”
“We therefore believe that any agreement on paper is likely to be an extremely unstable equilibrium, with further significant episodes of volatility more likely in the future,” he wrote in a note on Wednesday.
Key questions also remain about what concessions Iran could offer in return. Even in the event of a breakthrough, energy markets may not stabilize immediately.
If the Strait of Hormuz were to open immediately, it would take time for energy supplies to return to normal levels due to previous production outages and the slow restart of oil and gas infrastructure, Wan said.
Shipping restrictions and insurer caution are also likely to delay a full recovery.
Willie Walsh
A temporary ceasefire may provide short-term relief to energy markets, but airlines still face higher fuel costs.
“The reality is that with this kind of cost increase, airlines can't absorb it,” Willie Walsh, CEO of the International Air Transport Association (IATA), told CNBC.
He added that carriers may increase ticket prices or reduce the number of connections to cope with cost pressures.
The situation is particularly worrying for Asia, because about 80 percent aviation fuel in the region flows through the Strait of Hormuz.
Despite this, he emphasized, “demand for air travel remains very strong.”
The above text is a translation from American edition of Business Insider
