US‑Iran peace talks ease market volatility but uncertainty keeps oil prices hovering, complicating recovery efforts
Published On 29 Jun 2026
President Donald Trump highlighted falling pump prices as U.S. gasoline costs start to decline, even as clashes continue in the Strait of Hormuz ahead of potential peace talks.
“Gas prices are coming down,” Trump posted on Monday on his Truth Social platform.
The average price per gallon of petrol fell to $3.86, according to the American Automobile Association (AAA), which tracks daily fuel prices. This reflects a drop from a mid‑May peak of $4.48 and follows Trump’s mid‑June announcement about the reopening of the Strait of Hormuz. Prices, however, remain above the $2.98 per gallon level recorded on February 28, shortly after the initial U.S.–Israel strikes on Iran.
A fresh diplomatic push between the United States and Iran follows several days of tit‑for‑tat attacks, triggered by an Iranian strike on a cargo vessel in the strait that normally handles about one‑fifth of global oil exports.
Uncertainty surrounding a lasting ceasefire is pressuring supply chains, which may limit further price declines.
Oil futures rose more than 1 % on Monday after fresh attacks, although analysts note that the renewed peace talks prevented a steeper increase.
“The recent price drops occurred despite a volatile week marked by reciprocal strikes between the U.S. and Iran, with hostilities halted just before Sunday,” said Patrick De Haan, head of petroleum analysis at GasBuddy, in a note. “The market remains highly unpredictable.”
Earlier this month, analysts told Al Jazeera that supply‑chain disruptions and shutdowns would likely keep prices elevated for months, even if a lasting agreement holds, because U.S. strategic reserves have reached their lowest level since the Reagan era.
“While hindsight is clear, the outage’s unsustainability cannot be reversed. With domestic commercial stocks and the Strategic Petroleum Reserve depleted, global markets now depend on U.S. inventories to rebalance, extending the recovery timeline,” analysts at EverCore ISI Research noted in a Monday report.
Notwithstanding the fragile cease‑fire, shipping activity continues. Saudi Aramco loaded a vessel capable of carrying two million barrels on Monday, following three similar shipments over the weekend, according to LSEG data.