- Brent crude fell over 6% to $82.41 amid renewed US-Iran talks on reopening Strait of Hormuz
- WTI futures dropped 4.5% to $80.89 after Trump called off imminent attack on Iran for deal talks
- Trump announced Iran and Middle East agreed to hold off attacks pending a nuclear and strait deal
Oil Prices On Aug. 3: International crude oil prices slumped on Monday, Aug. 3 as hopes of peace in the Middle East grew, while the yen jumped suddenly after the US and Japan confirmed joint intervention to support the frail currency. Brent crude futures sank more than 6% to $82.41 after US President Donald Trump said talks with Iran will happen on Monday. West Texas Intermediate futures for September delivery declined 4.5% to $80.89 per barrel. Trump called off an imminent attack on Iran to reach a deal to reopen the Strait of Hormuz and resolve the impasse over Tehran's nuclear capabilities.
"We have just been asked by Iran, and other Middle Eastern Countries, to hold off any attack in that the perimeters of a deal has been agreed to," Trump said in a Truth Social post. He said the proposed agreement would include the "Immediate, Complete, and Total OPENING OF THE HORMUZ STRAIT, and an end to Iran's nuclear threat." Trump has been weighing another round of strikes on Iran amid fading prospects for a diplomatic resolution to the conflict, which began on Feb. 28.
ALSO READ: 'Not Looking To Kill People': Trump Says Iran Talks To Resume Today Amid Efforts To Reopen Hormuz
US-Iran Truce?
Iran responded cautiously to Trump. "Although the enemy's recent statements are part of a psychological and cognitive warfare campaign, we consider every threat to be real and take it seriously," said Seyyed Majid Ibn Al-Reza, Iran's acting defense minister, according to a state media post on 'X'. Iran's Fars International news agency, which is affiliated with the Islamic Revolutionary Guard Corps, dismissed Trump's proposal, saying in a Telegram post that his demands amounted to a "wish list."
The proposed truce deal builds on a 14-point memorandum of understanding signed by Washington and Tehran on June 17, 2026, under which both nations had agreed to halt strikes and expand on a ceasefire first reached in April. That framework had envisaged the reopening of the Strait of Hormuz, an end to the US naval blockade of Iranian ports, an Iranian commitment to forgo its nuclear weapons, the easing of American sanctions as well as the release of frozen Iranian assets.
ALSO READ: Week Ahead On D-Street: US-Iran Conflict, RBI MPC Decision, SBI, Airttel Q1 Earnings & More
Market Impact
In global markets, the S&P 500 futures rose 0.4% while Nasdaq futures gained 0.6%. But Japan's Nikkei 225 dipped nearly 1% and South Korea's KOSPI benchmark slid 3.6% after a turbulent July in which it slumped 22%. MSCI's broadest index of Asia-Pacific shares outside Japan was down 1% in early trading. The Japanese currency rose more than 1% to 155.39 per US dollar on Monday in a sudden move that put market participants on alert for another bout of intervention.
Japan and the US conducted coordinated yen-buying intervention and will not hesitate to take further action, Japan's finance ministry said, confirming a rare bilateral action to halt the yen's slide to 40-year lows. Ahead of the announcement, Trump said on Sunday the US was helping Japan to support the yen as a sign of friendship and to help the world economy. "They have a weakening yen, and they wanted a little bit of help. And we're always there for Japan," Trump said in response to a query about why the US is helping to support the yen.
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