Global oil prices took a sharp dip this week, reversing last week's rally sparked by Iran's warnings to block the Strait of Hormuz - a vital chokepoint for one-fifth of the world's oil. Tehran's threats initially spooked markets, sending Brent crude soaring. But when military escalation failed to materialize, and the Strait remained open, traders backed off. The result? A dramatic 7% drop in oil prices - the biggest single-day fall in three years.

The market correction also reflects strong global supply: OPEC+ production remains stable, U.S. shale output is robust, and stockpiles are ample. As geopolitical fears eased, fundamentals returned to center stage. Analysts now say prices may stabilize in the $50–60 per barrel range - unless new conflict breaks out.

However, the calm may be temporary. If Iran follows through with its threats or tensions reignite in the Gulf, prices could spike again, hitting consumers and triggering global inflation.

For now, oil markets are breathing easy - but the pressure hasn't disappeared.