Oil Falls Nearly 2% After U.S. Pauses Project Freedom
Brent and WTI slipped about 1.8% and 1.7% after President Trump announced a brief pause to Project Freedom in the Strait of Hormuz; Iran rejected the U.S. account.
Oil prices fell nearly 2% on Tuesday after President Donald Trump announced a pause to Project Freedom, a U.S.-led operation in the Strait of Hormuz, and Iran disputed the U.S. account. Brent crude dropped 1.81% to $107.88 a barrel and West Texas Intermediate slid 1.72% to $100.51. The selloff extended across the energy complex: natural gas fell 0.67% to $2.77, gasoline declined 0.93% to $3.59 and heating oil lost 1.28% to $3.98.
Trump posted on Truth Social that Project Freedom would be paused “for a short period of time” while officials explore whether an agreement with Iran can be finalized. He cited requests from Pakistan and other countries, what he described as “tremendous Military Success” in the campaign against Iran, and “Great Progress” toward a “Complete and Final Agreement.” He added the U.S. naval blockade of Iranian ports would remain in “full force and effect.”
Project Freedom was designed to free neutral vessels reportedly stuck in the Strait of Hormuz and had U.S. Central Command backing. CENTCOM allocated guided-missile destroyers, more than 100 aircraft, unmanned platforms and roughly 15,000 service members to the mission. The pause was announced shortly after the operation began.
Tehran pushed back on the U.S. description. An Iranian official described the president’s post as “riddled with falsehoods” and characterized the operation as having “failed completely.” The official added Iran “will not participate in direct negotiations until the United States formally announces the end of the blockade.” Senior Iranian lawmaker Ebrahim Azizi warned any U.S. interference in the Strait of Hormuz would be treated as a violation of the standing ceasefire.
The conflicting accounts coincided with the drop in oil and other energy prices as market participants reassessed near-term risks to shipping through the Hormuz Strait.
Details about next steps for Project Freedom and the prospect of talks between U.S. and Iranian representatives remain limited. The president framed the pause as temporary; Iranian officials have said they will not enter direct negotiations while the blockade is in place.
