Oil dropped almost 15% to close to $95 (€81.20) a barrel and European gas dropped by a similar margin, in the wake of the US president's announcement that he has accepted a proposal for a two-week ceasefire with Iran.
The drop in prices unwinds about half of the increase in energy prices seen since the outbreak of hostilities at the end of February.
This suggests that while there may not be an immediate reset of prices for consumers, there will be a pause in the rise in prices at the pump.
It will be a similar situation for fertiliser prices which may take months, rather than weeks, to unwind the prices rises already seen in markets.
While details remain thin on what has been agreed, it does look like the reopening of the Strait of Hormuz will happen.
Market risk
The two-week deadline on talks, however, means that there is still considerable risk for the market to take account of.
There is also the damage already done to the infrastructure in the region, particularly Qatar’s liquified natural gas capacity, which means that even if a lasting peace can be found, the world could remain short of key resources for some time.
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