Global oil prices plunged to their lowest levels in over a week following the news of a ceasefire agreement between Iran and Israel, as announced by US President, Donald Trump.
This development has now eased fears over potential supply disruptions in oil supply from the Middle East, which is the most oil-producing region in the world.
Brent crude fell by $2.08, or 2.9%, to $69.40 per barrel as of 03:30 GMT, after earlier plunging more than 4% and touching their lowest since June 11.
The price fall followed a five-month high due to fears that escalating hostilities between Israel and Iran could draw in more players and threaten oil flows through the Strait of Hormuz, a key chokepoint for nearly 20% of global oil consumption.
Trump, in a statement late Monday, said that both Iran and Israel had agreed to a “complete and total ceasefire”, with Iran set to begin the truce immediately, followed by Israel within 12 hours.
Analysts believe the truce, if sustained, could restore stability to the oil markets.