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Strait of Hormuz reopens, oil prices plunge and markets react

Iran’s foreign minister announced Friday morning that the Strait of Hormuz has reopened for commercial ships.

Fuel market analyst Patrick De Haan with GasBuddy says energy markets had a quick reaction to the news, which showed a positive trend for consumers.

“Oil prices were plummeting 10% to 11% at recent check,” De Haan said. “The price of gasoline is plummeting on the wholesale level.”

Ag economist Jim McCormick with AgMarket.Net tells Brownfield grain futures initially moved lower.

“We had a lot of emotion into the market,” McCormick said. “Fearful of a food shortage because of the lack of fertilizer flow. Remember, a lot of the world’s fertilizer comes from that section of the world and there was a fear of a potential shortage of fertilizer as we work through the seasons.”

McCormick says he’s hopeful the Strait’s reopening could give farmers at least a little bit of relief when it comes to fertilizer costs.

“If this starts to get this fertilizer moving and the price of fertilizers start to dip on the world market, hopefully that will translate to weaker prices here in the United States as well.” McCormick said.

On social media, President Trump confirmed the Strait is open, but added that a U.S. naval blockade will remain in force for Iran until final peace negotiations are reached.

Jim McCormick: