Oil prices fell to their lowest levels in months Monday after President Donald Trump announced an agreement with Iran to reopen the Strait of Hormuz, raising expectations that relief at the gas pump could follow within weeks.
Energy analysts cited by the New York Post said U.S. drivers could begin seeing lower gasoline prices in as little as one to two weeks if the recent drop in crude oil holds.
U.S. crude futures fell nearly 5% Monday, while Brent crude also dropped sharply as traders responded to the announcement.
The Strait of Hormuz carries roughly 20% of global seaborne oil shipments, making it one of the world’s most critical energy chokepoints.
Disruptions to shipping through the waterway during the conflict helped push oil and gasoline prices higher in recent months.
Patrick De Haan, GasBuddy’s head of petroleum analysis, told the Post that falling crude prices are already beginning to pressure gasoline costs lower, though retail prices typically lag behind oil markets.
De Haan said motorists could start seeing modest declines at the pump within one to two weeks if oil prices remain near current levels.
Analysts said further price declines are possible if commercial shipping fully resumes through the Strait of Hormuz and the agreement holds.
Wall Street rallied on the news, with major indexes rising as investors bet lower energy costs could ease inflation pressures and support economic growth.
Airline, travel, and transportation stocks were among the biggest beneficiaries of cheaper fuel expectations.
Investors also saw the drop in oil prices as potentially reducing inflation pressure that has complicated Federal Reserve policy decisions.
Analysts cautioned that a full return to pre-conflict gasoline prices could take longer, as shipping networks normalize and regional energy infrastructure is repaired.
They said the speed of future declines will depend on whether the agreement holds and whether oil flows through the Strait of Hormuz remain uninterrupted.