In a major diplomatic breakthrough, the United States and Iran have reportedly reached a framework agreement to end months of conflict and reopen the strategically vital Strait of Hormuz, a move that has already sent shockwaves through global energy markets.

According to reports by Reuters, Axios, and other international media outlets, the agreement includes an immediate halt to hostilities and the gradual reopening of the world’s most important oil shipping route, through which nearly 20% of global oil and gas supplies pass.

The deal, reportedly brokered with the assistance of Pakistan, is expected to be formally signed in Switzerland later this week. Both nations will then enter a 60-day negotiation period to address unresolved issues, including Iran’s nuclear programme and sanctions relief.

Global markets reacted swiftly to the announcement, with oil prices plunging to their lowest levels in months amid expectations that energy supplies will stabilize once shipping resumes through the Strait of Hormuz.

While world leaders have welcomed the development, analysts caution that significant hurdles remain before a permanent peace agreement can be secured.