Exxon, Chevron, BP All Drop as Peace Talk Hopes Shake the Oil Market

TLDR

• Exxon and Chevron shares fell over 3.5% as oil prices dropped sharply on U.S.-Iran peace deal hopes
• Brent crude fell more than 10% to around $97.97 a barrel, slipping below $100
• West Texas Intermediate dropped over 11% to around $90.35 a barrel
• Trump paused the “Project Freedom” military operation in the Strait of Hormuz, citing “great progress” in talks
• European energy stocks also fell hard, with BP dropping more than 5% and Shell declining 4.5%

Oil stocks took a heavy hit on Wednesday after President Donald Trump announced a pause to a U.S. military operation in the Strait of Hormuz, saying peace talks with Iran were making progress.

Trump posted on Truth Social late Tuesday that he was suspending “Project Freedom,” a military effort aimed at reopening the strait. He said the pause would last a “short period” while negotiations with Tehran continued.

The announcement sent oil prices sharply lower. Brent crude fell more than 10% to around $97.97 a barrel, dropping below the $100 mark. West Texas Intermediate dropped over 11% to $90.35 a barrel.

Exxon Mobil shares fell around 3.6% in early trading. Chevron dropped about 3.3%. Both stocks were among the hardest hit in the U.S. energy sector.

Exxon Mobil Corporation, XOM

Other U.S. oil companies also saw steep declines. Occidental Petroleum led premarket losses with a drop of 7.6%. Marathon Petroleum fell 6.3%, ConocoPhillips slid 5.4%, Devon Energy dropped 5.7%, and Diamondback Energy fell 4.5%.

Occidental also reported earnings on Wednesday. The company posted a sharp rise in adjusted profit, but net sales came in below analyst expectations for the first quarter.

APA fell 4.6% on the day. The broader S&P 500, by contrast, was 0.8% higher, as easing tensions lifted other parts of the market.

European Energy Stocks Also Fell

The selloff was not limited to the U.S. European energy majors saw steep losses too.

In London, BP shed more than 5% to 542.2p. Shell declined 4.5% to 3,165.5p. French company TotalEnergies fell 5.4% to €75.07 in Paris.

Axios reported that the Trump administration believed it was close to agreeing a one-page memorandum of understanding with Iran that would end the conflict in the Middle East. Two U.S. officials and two other sources briefed on the matter were cited.

What Triggered the Oil Price Drop

The core reason for the price drop was the prospect of easing tensions in the Gulf region. A peace deal with Iran would reduce the risk of supply disruptions through the Strait of Hormuz, a key route for global oil shipments.

In April, Iran briefly reopened the Strait of Hormuz before closing it again after the U.S. said it would not lift its blockade of Iranian ports.

As of Wednesday morning, negotiations between U.S. and Iranian representatives were ongoing, with no final agreement announced.

The post Exxon, Chevron, BP All Drop as Peace Talk Hopes Shake the Oil Market appeared first on CoinCentral.