Traders work on the floor of the New York Stock Exchange during morning trading, Friday, in New York City. All three major indexes surged at opening, with the Dow Jones leading the way, opening over 700 points after Iran declared the Strait of Hormuz will be completely open after the ceasefire agreement between Lebanon and Israel. Getty Images via AFP-Yonhap

NEW YORK — Oil prices dropped more than 10 percent Friday, and U.S. stocks raced toward another record after Iran said the Strait of Hormuz is open again for commercial tankers carrying oil from the Persian Gulf to customers worldwide.

The S&P 500 leaped 1.3 percent as Wall Street rallied to the finish of a third straight week of big gains, its longest streak since Halloween. A freer flow of oil would take pressure off prices not only for gasoline but also for groceries and all kinds of other products that get moved by vehicles. It could even ultimately help people pay less on credit-card interest or mortgage bills.

The Dow Jones Industrial Average briefly climbed nearly 1,070 points and was up 978 points, or 2 percent, as of 11:45 a.m. Eastern time, while the Nasdaq composite was 1.6 percent higher

The U.S. stock market has jumped more than 12 percent since hitting a bottom in late March on hopes the United States and Iran can avoid a worst-case scenario for the global economy despite their war . Friday’s reopening of the Strait of Hormuz , which may only be temporary, is the clearest signal yet for optimism, and President Donald Trump said late Thursday that the war “should be ending pretty soon.”

The price for a barrel of benchmark U.S. crude plunged immediately after Iran’s foreign minister, Abbas Araghchi, posted on X that the passage for all commercial vessels through the strait “is declared completely open” as a ceasefire appears to be holding in Lebanon. He said it would stay open for the remaining period of the ceasefire, and U.S. oil tumbled 10.8 percent to $81.38 per barrel.

Brent crude, the international standard, dropped 10.5 percent to $88.96 per barrel. To be sure, it remains above its $70 price from before the war, indicating some caution is still embedded in financial markets.

Several times since the war began, optimism on Wall Street has quickly swung to doubt about a possible end to the fighting. That in turn has caused vicious and sudden swings of prices for everything from stocks to bonds to oil.

Minutes after the Iranian foreign minister’s announcement of the reopening of the Strait of Hormuz, Trump said on his social media network that the U.S. Navy’s blockade of Iranian ports remains “in full force” until both sides reach a deal on the war. He, though, also said that “should go very quickly in that most of the points are already negotiated” and emphasized it by using all capital letters.

Companies with big fuel bills soared to some of Wall Street’s biggest gains following the easing of oil prices.

Source: Korea Times News