Oil Tumbles, Brent Headed for Worst Month Since 2020 on US-Iran Truce Hopes

Oil prices fell sharply on May 29, 2026, following reports the US and Iran tentatively agreed to extend a ceasefire by 60 days, raising the prospect of resuming oil flows through the Strait of Hormuz. Brent crude dropped below $93 a barrel, putting it on track for an 18% monthly decline—its worst since 2020. West Texas Intermediate traded near $88. The potential truce, first reported by Axios, would allow unrestricted shipping. But President Donald Trump has not yet agreed, and Vice President JD Vance cautioned it was too early to know “when or if” a deal would be reached. Treasury Secretary Scott Bessent said only that negotiating teams “have been going back and forth.” Even if extended, significant obstacles remain to restoring supply, including mine clearance in Hormuz, restarting shut-in fields, and repairing infrastructure. TD Securities strategist Ryan McKay noted another 1 billion barrels could be lost during a “recovery” period. US distillate stockpiles have plunged to two-decade lows, and crude inventories at Cushing, Oklahoma, fell for a fifth week to 23 million barrels, nearing minimum operating levels.