(Bloomberg) — Oil sank after the US and Iran agreed to an interim deal to end their months-long war, potentially allowing the Strait of Hormuz to reopen and easing a supply crunch that has rattled global energy markets.

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Brent tumbled more than 4% to below $84 a barrel, after closing last week at a three-month low, while West Texas Intermediate was near $81. President Donald Trump said in social-media posts he was authorizing the “toll free opening” of Hormuz, as well as ending a blockade of the Islamic Republic, with the strait to reopen when the deal is signed on Friday.

While the US leader heralded the move to “let the oil flow!,” traders and analysts struck a more cautious tone, highlighting the lack of fine-print detail on the text, hurdles for the shipping industry to restart transits of the waterway, and a drawn-out timeline for fields to restart pumping.

Iran Deputy Foreign Minister Kazem Gharibabadi confirmed an agreement was reached, but said the text would be published only after the signing event in Switzerland. US Vice President JD Vance said he “certainly” plans to attend the ceremony, and it was possible that Trump would also go.

Global energy markets have been in thrall to the war since it erupted in late February, when the US and Israel attacked Iran to curb its nuclear program. Tehran’s response included strikes across the Persian Gulf and shuttering Hormuz, which in peacetime carried about a fifth of global oil flows. US forces subsequently imposed their own blockade of Iran-linked vessels.

After spiking in the initial period of the conflict, oil prices have given up ground in recent weeks on repeated signals that Washington and Tehran were close to an agreement, as well as signs that some crude flows via the strait had resumed. In addition, developed economies tapped emergency crude reserves, and some leading importers — notably China — scaled back imports.

Lower crude prices — if they endure — stand to reduce inflationary risks for policymakers including at the Federal Reserve, which will review interest rates this week. Beyond oil, European natural gas futures sank as much as 5.8% on Monday, while gold and copper rose as the US dollar weakened. Crops declined.

At this stage, many hurdles remain before traffic through Hormuz can fully resume. These include the clearing of mines, as well as clarity on Tehran’s desire to exercise greater control over vessels passing through.

“We still need to understand what the deal means,” said Chris Weston, head of research at Pepperstone Group Ltd. “Even with the strait slated to open on Friday, there could be mines still, and insurance providers could be charging high rates.”

In a sign of the market’s shifting dynamics, Brent’s prompt spread — the difference between its two nearest contracts — narrowed to less than $1 a barrel in backwardation. While that remains a bullish pattern, with the nearer contract above the next in line, it is down from more than $12 in April.

Traders will be on alert for signs of the potential restart of crude output from Persian Gulf fields that were shut-in during the conflict. Producers have warned that reviving supplies in full could take months given the technical and geological challenges, as well as damage to infrastructure.

In addition, strategic and commercial oil and product stockpiles will need to be replenished after they have been drawing at a record pace.

“The structural gaps left from this war will take time to fill,” Weston said.

The interim deal between Washington and Tehran sets the stage for 60 days of talks on the fate of the Islamic Republic’s nuclear program. Even as he celebrated the breakthrough, Trump told the New York Times if an agreement wasn’t reached on that issue, he could restart military attacks.

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