A major drop in oil prices might be in the offing should the United States and Iran reach an agreement that would reopen the Strait of Hormuz.

As of Sunday, Brent hovered around $103 to $105 amid positive signals that the warring parties were ready to end the month-long war.

Speculations were rife that the reopening of the strait would crash oil prices as well as petrol prices.

The New York Times reports that the US and Iran have agreed in principle to a deal that would wind down the war in the Middle East by reopening the Strait of Hormuz and committing Iran to disposing of its highly enriched uranium.

Quoting a senior US official on Sunday, the NYT reports that Iran’s leaders or official state media have not publicly commented on what is in any potential agreement or what is being discussed.

The US official reportedly said a deal had not yet been signed and was still subject to final approval from President Donald Trump and Iran’s supreme leader, which could take days.

Trump had, on Saturday, said the Strait of Hormuz would be reopened as part of a proposed agreement involving the United States, Iran, and several Middle East countries amid efforts to end the ongoing Iran war.

Trump disclosed this in a post on the Truth Social media platform after a series of calls with leaders from Saudi Arabia, the United Arab Emirates, Qatar, Pakistan, Türkiye, Egypt, Jordan, Bahrain, and Israel.

According to him, an agreement had been negotiated, subject to finalisation between the United States, Iran, and various other countries.

The American leader added that the final aspects and details of the deal are currently being discussed and will be announced shortly.

Speaking on the strategic waterway at the centre of the conflict, Trump declared that the Strait of Hormuz, through which 20 per cent of global oil is transited, would be reopened.

Iran closed the Strait since the war commenced on February 28, leading to a spike in oil prices and fuel supply.

In a post on Truth Social on Sunday, Trump said talks with Iran are “proceeding in an orderly and constructive manner”, adding that he has told his representatives not to “rush” into a deal because time is on their “side”.

The US president said the blockade on Iranian ports will remain in “full force” until an agreement is reached. “Both sides must take their time and get it right. There can be no mistakes!” he wrote.

Trump said Iran cannot “develop or procure” a nuclear weapon or bomb under any circumstances. He said the US’s relationship with Iran is becoming much more “professional and productive” and thanked Middle Eastern countries for their “support and cooperation”.

Trump had earlier said he had discussions with Saudi Crown Prince Mohammed bin Salman; UAE President Mohammed bin Zayed Al Nahyan; Qatar’s Emir Tamim bin Hamad Al Thani; Pakistan’s Field Marshal Syed Asim Munir; Turkish President Recep Tayyip Erdoğan; Egyptian President Abdel Fattah El-Sisi; Jordan’s King Abdullah II; and Bahrain’s King Hamad bin Isa Al Khalifa.

He also revealed that he separately spoke with Israeli Prime Minister Benjamin Netanyahu, saying the conversation went well.

“An agreement has been largely negotiated, subject to finalisation between the United States of America, the Islamic Republic of Iran, and the various other countries, as listed.

“Separately, I had a call with Prime Minister Bibi Netanyahu, of Israel, which, likewise, went very well. Final aspects and details of the deal are currently being discussed and will be announced shortly. In addition to many other elements of the agreement, the Strait of Hormuz will be opened,” he said on Saturday.

The closure and military tensions around the Strait of Hormuz triggered major disruptions in global oil supply chains and heightened fears of a broader Middle East conflict. In Nigeria, petrol prices rose from N830 to over N1,300. A drop in global crude prices means cheaper fuel.