What Happened This Week
On April 8, barely an hour before a U.S. deadline, the U.S. and Iran agreed to a two-week pause in fighting. Pakistan brokered the deal. The key promise: Iran would reopen the Strait of Hormuz, the narrow waterway that carries about 20% of the world's oil supply.
Markets loved the news at first. Oil prices dropped more than 16% in a single day, the biggest one-day plunge since the pandemic in 2020. West Texas Intermediate crude fell to $94.41 per barrel. The S&P 500 surged about 2.5%, one of its strongest sessions this year. Investors exhaled.
That relief did not last long.
The Ceasefire Is Cracking
Within hours of the deal, Israel launched more than 100 strikes across Lebanon, killing at least 303 people according to Lebanon's health ministry. Prime Minister Netanyahu says Lebanon is not part of the ceasefire. Iran disagrees strongly.
Iran's Foreign Minister Abbas Araghchi put it bluntly: the U.S. must choose between a ceasefire or continued war through Israel. It cannot have both. An adviser to Iran's parliament warned that without restraining Israel in Lebanon, "the missiles are ready to launch."
Meanwhile, the Strait of Hormuz is still largely blocked. Ships are being turned away or charged up to $1 million for passage. Abu Dhabi's national oil company confirmed on April 9 that the strait remains restricted despite the ceasefire agreement.
Where Oil Stands Now
As of April 10, oil has settled around $98 per barrel for WTI and $96 for Brent. That is well below the $113 peak from earlier in the conflict. But it is still far above the $70 range where oil sat before the war started.
Goldman Sachs warned that if the Hormuz blockade lasts another month, Brent crude could stay above $100 for the rest of 2026. Gasoline prices remain above $4 per gallon nationally.
The Islamabad Talks
Pakistan is hosting the next round of negotiations in Islamabad, set to begin Saturday, April 11 (local time). Vice President JD Vance will lead the American delegation, alongside envoy Steve Witkoff and Jared Kushner. Iran is sending Parliament Speaker Mohammad Bagher Ghalibaf and Foreign Minister Araghchi.
The agenda is wide. It covers the Strait of Hormuz, Iran's nuclear enrichment program, and a path to a lasting peace. Pakistan set a modest goal: simply keep talks going. That tells you how fragile things are.
What to Watch
The stock market is caught between hope and risk. If talks in Islamabad go well, oil could drop further and stocks could rally. If the ceasefire collapses, expect oil to spike back above $110 and markets to sell off hard.
Energy stocks have been the clear winners during this conflict. Defense stocks have also done well. On the flip side, sectors that depend on cheap energy, like airlines and consumer goods, have taken a hit.
For now, the safest bet is patience. The next 48 hours in Islamabad will set the tone for markets heading into the rest of April. Keep an eye on the Strait of Hormuz. When ships start moving freely again, that is your signal that real progress is being made.
