Oil tumbles, stocks hit records as Bessent floats Hormuz deal

Oil prices fell sharply on Tuesday after U.S. Treasury Secretary Scott Bessent said a deal could be reached with Tehran within days on reopening the Strait of Hormuz, raising hopes of an end to five months of disruption to global energy supplies.

Brent crude dropped around 4 to 5 percent to near $80 a barrel, while West Texas Intermediate fell to roughly $76, according to Reuters and AFP. The declines came after oil had already tumbled on Monday when President Donald Trump said he had called off a planned strike on Iran to allow for negotiations.koreatimes+2

Bessent's Comments Spark Rally

"We are in talks with the Iranians," Bessent told CNBC's "Squawk Box" on Tuesday morning. "There is a chance we may have a deal today or tomorrow to open the strait and move towards a more normalized position in this conflict."cnbc

He added that he expected energy prices to "settle back down, which, as I said, will be good for the entire world."koreatimes

The remarks sent stocks surging. The Dow Jones Industrial Average built on a record closing high reached Monday, while the S&P 500 was on track for its own record. In Europe, benchmark indexes in Paris and Milan closed at all-time highs, while Frankfurt's DAX and Madrid extended records from the prior session.english.ahram+1

Caution Persists

Investors remained wary, however. An unknown projectile hit a cargo ship in the strait on Tuesday, and previous announcements of imminent deals have gone nowhere. Iran has denied direct negotiations with the United States.wsj+3

"The market is now trying to price a more nuanced geopolitical path: lower risk of immediate military escalation, but no guarantee yet that the Strait of Hormuz returns to normal functioning," said Patrick Munnelly, market strategist at Tickmill Group.koreatimes

Energy Majors Post Record Profits

The months-long disruption has been a windfall for oil producers. BP ↘ 3.19% reported profit that more than doubled in the second quarter, while Saudi Aramco posted a 44 percent surge in net profits. The five largest Western energy majors — BP, Chevron ↘ 2.79%, ExxonMobil Exxon Mobil Corporation ↘ 3.20%, Shell ↘ 1.34%, and TotalEnergies ↘ 0.84% — reported combined net profits of nearly $47 billion for the April-June period.english.ahram+1

Traders now await U.S. jobs data later this week for further signals on the direction of interest rates.