Front‑month West Texas Intermediate futures fell 2.4% to $74.96 a barrel, while Brent slipped 2.1% to $77.89. Traders in Asia priced in a reopening of the Strait of Hormuz, the chokepoint that moves about 20% of world oil. The slide reflects optimism that Iranian shipping will resume once U.S. sanctions ease. The move eased concerns about a supply shock that had loomed since last year.

U.S. officials said an interim memorandum, read but not released at Tehran’s request, obliges Iran to reopen the waterway after Washington lifts the oil‑sale blockade. The text promises a 60‑day toll‑free period for commercial vessels in exchange for sanction relief. ANZ Research warned that a sudden supply surge could depress prices, yet noted shipowners may hesitate if the deal collapses.

Asian sovereign bonds fell as investors priced in higher U.S. Federal Reserve rates, echoing broader risk‑off sentiment. With the Strait’s fate still contingent on diplomatic follow‑through, oil markets may remain volatile despite the price dip. Energy firms with exposure to Gulf shipping are recalibrating inventories, while refiners brace for potential over‑supply.