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Crude Oil Falls 10% as Strait of Hormuz Opens
Brent Crude Down 10.3% to $89.13
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NEW YORK — Oil prices are falling by more than 10% on April 17, and Wall Street is rallying towardanother recordafterIran said the Strait of Hormuz is fully open, allowing oil tankers to exit the Persian Gulf again and carry crude to customers worldwide.
The S&P 500 leaped 1.3% as Wall Street rallied to the finish of a third straight week of big gains, its longest streak since Halloween. A freer flow of oil would take pressure off prices not only for gasoline but alsofor groceries and all kinds of other productsthat get moved by vehicles. It could even ultimately help people pay less on credit-card interest or mortgage bills.
The Dow Jones Industrial Average briefly climbed nearly 1,070 points and was up 978 points, or 2%, as of 11:45 a.m. Eastern time, while the Nasdaq composite was 1.6% higher
Stocks have jumped more than 12% since hittinga bottom in late Marchon hopes that the United States and Iran can avoid a worst-case scenario for the global economy despitetheir war. The reopening of theStrait of Hormuzis the clearest yet signal for optimism, andPresident Donald Trumpsaid in a speech late April 16 that the war“should be ending pretty soon.”
The price for a barrel of benchmark U.S. crude plunged immediately after Iran’s foreign minister, Abbas Araghchi, posted on X that the passage for all commercial vessels through the strait “is declared completely open” as a ceasefire appears to be holding in Lebanon. He said it would stay open for the remaining period of the ceasefire, and U.S. oil tumbled 10.8% to $81.38 per barrel.
Brent crude, the international standard, dropped 10.5% to $88.96 per barrel. To be sure, it remains above its $70 price from before the war, indicating some caution is still embedded in financial markets.
Several times since the war began,optimismon Wall Street hasquickly swungto doubt about a possible end to the fighting. That in turn has caused vicious and sudden swings of prices for everything from stocks to bonds to oil.
Minutes after the Iranian foreign minister’s announcement of the reopening of the Strait of Hormuz, Trump said on his social media network that theU.S. Navy’s blockade of Iranian portsremains “in full force” until both sides reach a deal on the war. He, though, also said that “should go very quickly in that most of the points are already negotiated” and emphasized it by using all capital letters.
Companies with big fuel bills soared to some of Wall Street’s biggest gains following the easing of oil prices.
United Airlines surged 8.8%. On April 16, the head of the International Energy Agency had said thatEurope has “maybe six weeks or so” of remaining jet fuel supplies.
Operators of cruise ships, which guzzle fuel, also steamed higher. Norwegian Cruise Line jumped 7.8%, and Royal Caribbean Group gained 9.5%.
Housing and auto-related companies also got some relief from the drop in oil prices.
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With less threat of high inflation hurting the economy, a sustained drop in oil prices could convince theFederal Reserve to resume its cuts to interest ratesto invigorate the economy. The yield on the 10-year Treasury sank to 4.23% from 4.32% late April 16, and lower yields can bring down rates for mortgages and other loans going to U.S. households and businesses.
Builders FirstSource, a supplier of windows and other products, rose 7.1%, and homebuilder Lennar gained 5.7% on hopes thatlower mortgage rateswill spur more people to buy houses. Carvana climbed 9.2% because lower loan rates can get more customers into new autos.
A strong start to the earnings reporting season for big U.S. companies has also helped to support the U.S. stock market, and several more financial companies joined the list of companies delivering bigger profits for the start of 2026 than analysts expected.
State Street rose 4.6%, and Fifth Third Bancorp added 1.9% after both reported better results for the latest quarter than expected.
They helped offset a 9.9% drop for Netflix, which fell even though it likewise delivered a better profit than expected. It did not raise its forecast for revenue growth for the full year, which analysts said may have disappointed some investors.
It also said, cofounder and chairman of the streaming company, willstep down from its boardof directors in June when his term expires.
In stock markets abroad, stock indexes leaped in Europe following Iran’s announcement about the Strait of Hormuz. France’s CAC 40 jumped 2%, and Germany’s DAX returned 2.3%.
In Asia, where trading finished for the day before the announcement, indexes were weaker. Japan’s Nikkei 225 lost 1.8%, and Hong Kong’s Hang Seng fell 0.9% for two of the bigger losses.
AP Business Writers Chan Ho-him and Matt Ott contributed to this report.
