Crude benchmarks tumbled more than five percent on Wednesday after U.S. and Iranian officials signaled a draft cease‑fire agreement that could end the naval standoff in the Strait of Hormuz. west Texas Intermediate fell below $90 per barrel and Brent slipped to $94, marking the lowest levels in four weeks.

Ceasefire draft pushes WTI below $90

At 3 p.m. EDT, WTI was down 5.40% at $88.82 a barrel, while Brent fell 5.19% to $94.41, according to market data cited by the source. Traders interpreted the draft document – which Iran’s state media said it had obtained – as the strongest signal yet that a diplomatic resolution could avert further conflict.

Iran's pledge to reopen Strait of Hormuz within a month

The draft agreement stipulates that Tehran will restore commercial shipping through the Strait of Hormuz to normal levels within one month, a move that could instantly relieve a key chokepoint for global oil flows. U.S. officials have echoed that negotiations are progressing and that Washington will “give talks every chance to succeed,” as reported.

U.S. Jones Act waiver extends to 90 days, affecting Gulf‑Coast shipments

In parallel, President Donald Trump’s administration extended a 60‑day Jones Act waiver to a total of 90 days, allowing foreign‑built vessels to move petroleum products between U.S. ports. Over sixty shipments have already used the exemption, reaching markets from California to New York, though the average U.S. gasoline price remains high at $4.46 per gallon, per AAA.

Political fallout: gasoline prices and GOP support

A recent Overton Insights survey found that 57% of respondents say high gasoline prices make them less likely to back the Republican Party, adding a political dimension to the energy debate. the same day, Texas Republican Bo French won a narrow Railroad Commission runoff,a body that oversees the state’s oil and gas sector, highlighting how local politics intersect with global market moves.

Will the U.S. fully lift its naval blockade?

The draft calls for the United States to end its naval blockade and withdraw forces, but the source notes no confirmation that Washington has formally agreed to these terms.. analysts warn that without a signed agreement, the risk of renewed tensions could quickly reverse the price gains.