Oil tumbles 10% as Wall Street rallies toward another record after Iran reopens the Strait of Hormuz

Stocks have jumped 12% since hitting a bottom in late March on hopes that the United States and Iran can avoid a worst-case scenario for the global economy despite their war. The reopening of the Strait of Hormuz, which may only be temporary, is the clearest signal yet for optimism, and President Donald Trump said in a speech late Thursday that the war “should be ending pretty soon.”

The price for a barrel of benchmark U.S. crude dropped sharply 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. U.S. oil tumbled 10.2% to $81.88.

Brent crude, the international standard, dropped 10.3% to $89.09. To be sure, it remains above its $70 level from before the war, indicating some caution is still embedded in financial markets.

Several times since the war began, optimism on Wall Street has quickly swung to 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 Friday that the U.S. Navy's blockade of Iran remains “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,” emphasizing 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 soared 9.8%, for example. On Thursday, the head of the International Energy Agency had said that Europe 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 9.3%, and Royal Caribbean Group gained 9.3%.

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 Friday of companies delivering bigger profits for the start of 2026 than analysts expected.

State Street rose 2.9%, and Fifth Third Bancorp added 1.4% after both reported better results for the latest quarter than expected.

They helped offset a 9.2% 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 Reed Hastings, cofounder and chairman of the streaming company, will step down from its board of 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 2.2%.

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.

In the bond market, Treasury yields eased sharply as falling oil prices took pressure off inflation. The yield on the 10-year Treasury dropped to 4.24% from 4.32% late Thursday.

AP Business Writers Chan Ho-him and Matt Ott contributed to this report.