Crude markets endured a violent swing on Wednesday, with Brent briefly piercing the $80-a-barrel floor before rebounding sharply as traders digested conflicting signals over the fate of a US-Iran peace accord. The benchmark grade touched a fresh three-month low in early dealings, extending a rout that had wiped more than 5% from prices on Tuesday, only to reverse course after President Donald Trump declared the memorandum of understanding was “not final” and warned that military strikes could resume if Tehran failed to comply. By the close in London, Brent had recovered to $79.55, up 0.75%, while West Texas Intermediate added nearly 1% to $76.79.

Viewed from Washington, the president’s intervention upended a narrative that had taken hold since Sunday, when both sides announced a framework to end nearly four months of hostilities and reopen the Strait of Hormuz. The draft text, which is due to be signed in Switzerland on Friday, reportedly offers Iran sweeping financial incentives, including the immediate right to sell its oil and petrochemicals. Yet Trump contradicted reports of instant sanctions relief and insisted he retained the option to resume bombing. From Tehran, the calculus appears equally delicate: the promise of normalised energy flows has already prompted a measurable increase in maritime traffic through the chokepoint, according to shipping data cited in Buenos Aires, but the Islamic Republic must now weigh the durability of American commitments against its own domestic pressures.

On trading floors in London and New York, the rebound was amplified by a set of US inventory figures far weaker than consensus forecasts, tightening the physical market at a moment when the paper market had been pricing in a deluge of Iranian barrels. The earlier sell-off had been driven by the prospect that a deal could add as much as 8 million barrels per day to global supply by next year, a scenario the Paris-based International Energy Agency lent credence to in its first 2027 outlook. The agency warned of a substantial surplus even if flows through Hormuz normalise only gradually, a forecast that capped the day’s gains and kept prompt Brent below the $80 threshold.

Analysts in London now speak of a nascent “Trump put” — the notion that the president’s willingness to wield military brinkmanship places an implicit floor under crude prices, preventing the kind of collapse that would destabilise both the US shale patch and allied Gulf producers. Yet the peace process remains fragile. Should the memorandum be formalised on Friday and sanctions genuinely eased, the market would face a structural shift that even hawkish rhetoric may struggle to offset. For now, traders are left parsing every word from the White House, aware that the difference between a durable ceasefire and a renewed bombing campaign could be measured in dollars per barrel.