Global oil prices dropped significantly after growing optimism over a possible agreement between the United States and Iran to reopen the Strait of Hormuz, raising hopes of smoother energy supplies and easing concerns over disruptions in the world's oil trade.

The decline came after US Treasury Secretary Scott Bessent suggested that an agreement related to the strategic waterway could be reached "today or tomorrow." His comments sparked a positive reaction across global financial and energy markets, with investors anticipating improved oil flows and lower supply risks.

Following the remarks, Brent crude, the global oil benchmark, fell below the $78 per barrel mark for the first time since July 13. Brent crude was trading at around $78.30 per barrel, while US West Texas Intermediate (WTI) crude also declined to about $74.50 per barrel, marking one of its lowest levels in nearly three weeks.

According to CNN, Bessent made the comments during an interview with CNBC, where he expressed optimism that diplomatic efforts between Washington and Tehran were making progress. The prospect of a breakthrough encouraged traders to reassess market expectations, leading to increased selling pressure in oil futures.

Markets await official agreement

The Strait of Hormuz is one of the world's most important oil shipping routes, carrying a significant share of global crude exports. Any disruption in the waterway has the potential to push energy prices higher, while signs of stability often have the opposite effect.

Market analysts said a successful agreement allowing normal oil shipments through the Strait of Hormuz would reduce concerns over global supply shortages. As a result, crude oil prices could remain under pressure in the coming weeks if the diplomatic momentum continues.

However, experts also warned that uncertainty remains until an official agreement is announced. They noted that negotiations between the United States and Iran have yet to produce a confirmed deal, meaning markets could remain volatile if talks face unexpected setbacks.

Adding to the positive sentiment, Qatar's Ministry of Foreign Affairs described the ongoing diplomatic efforts as entering a "highly positive stage." The statement further strengthened investor confidence and supported expectations that regional tensions could ease.

Meanwhile, shipping companies and energy market experts continue to closely monitor vessel movements through the Strait of Hormuz to assess whether oil transportation is returning to normal. Analysts believe that while recent developments are encouraging, caution is still necessary until the full details of any agreement become public.

It is worth noting that Brent crude had surged to $100.69 per barrel on July 23 amid heightened regional tensions. Since then, expectations of diplomatic progress and improving regional stability have contributed to a steady decline in oil prices. Although US officials remain optimistic about the negotiations, neither the full terms of a potential agreement nor an official confirmation from Iran has been released.