On June 15, 2026, the US and Iran officially signed a ceasefire memorandum of understanding, announcing the immediate and permanent cessation of all military actions across all fronts, including Lebanon. In the following 11 days, international oil prices dropped sharply. Brent crude briefly fell to $72.06 per barrel, dipping below the pre-war closing price of $72.48 and marking a cumulative decline of over 39% from the March high of $118.35. WTI crude settled at $71.92, down about 36% from its peak.
On June 26, WTI crude oil futures fell 2.22% to $70.326 per barrel, while Brent crude oil futures dropped 2.02% to $73.976 per barrel. During the session, WTI briefly touched $69.760.
Oil prices fell back to pre-conflict levels within just 11 days, far outpacing market expectations. Lower energy costs, easing inflationary pressures, and reduced valuation pressure on risk assets—on the surface, these factors paint a picture of "easing." However, this assumption requires a threefold test: Has safe passage through the Strait of Hormuz truly been restored? Has the Federal Reserve’s rate hike outlook changed due to falling oil prices? Have macro conditions for the crypto market actually improved?
By examining the realities of geopolitical constraints, the independent logic of monetary policy, and the transmission mechanisms within the crypto market, we can break down why the "illusion of easing" remains an unfulfilled expectation.
11 Days After the Ceasefire: Oil Prices Back to Pre-War Levels, but the Strait Is Not Yet "Safe"
Following the memorandum’s signing on June 15, oil prices began a textbook rapid decline. The market priced in the fading of geopolitical risk premiums—both the US and Iran pledged to end hostilities, with the US promising to restore shipping to full capacity within 30 days at most.
However, there remains a significant gap between actual shipping data and "full restoration." According to S&P Global Energy, the daily average vessel traffic through the Strait of Hormuz this month has recovered to about 57% of pre-conflict levels. On June 24, 78 ships passed through the strait, setting a single-day record since the outbreak of the Iran conflict. Yet this figure needs context: 78 is a single-day peak, not a sustained norm, and a 57% average recovery rate means over 40% of capacity is still missing.
More importantly, an attack on June 25 shattered the narrative that the strait is now "safe." The Wall Street Journal reported that Iran’s Islamic Revolutionary Guard Corps attacked a Singapore-flagged cargo ship in the Strait of Hormuz. The UK Maritime Trade Operations office reported that a cargo vessel was struck by an unidentified projectile about 7.5 nautical miles southeast of Oman’s Duqm anchorage, damaging the starboard side and the bridge. US officials revealed the vessel was hit by a drone.
This incident triggered a series of cascading effects. The International Maritime Organization (IMO), a UN agency, had planned to evacuate over 11,000 stranded seafarers from the Strait of Hormuz, but suspended the plan after the attack. The IMO stated that the attacked vessel was not following the organization’s evacuation plan and decided to suspend the operation to further assess whether safety guarantees remained valid.
Iran’s position is also noteworthy. On June 25, the IRGC Navy declared that ships passing through the Strait of Hormuz must coordinate with the IRGC Navy, warning that violators "will be dealt with." On June 26, the Persian Gulf Strait Authority announced that all vessels must follow designated routes and procedures when transiting the Strait of Hormuz. Ships deviating from assigned routes would forfeit safety and insurance coverage.
The memorandum’s pledge to "make every effort to ensure free and safe passage for commercial vessels within 60 days" has faced a substantial challenge after the attack. Shipping companies have ample reason to remain cautious—a cargo vessel was just attacked, the IMO suspended evacuation plans, and Iran issued a clear "at your own risk" warning. The ceasefire is fragile, navigation is gradual, and safety is conditional. These three factors together form the structural support preventing oil prices from falling much further.
Oil price behavior reinforces this point. Although WTI closed at $70.326 on June 26, it did not fall further after briefly touching $69.760. The geopolitical risk premium has not vanished; it remains embedded in current prices as a "risk discount"—the market is pricing in partial recovery but also retaining a premium for uncertainty.
Oil Prices Have Fallen, but Inflation Hasn’t—Core PCE Hits a Three-Year High
A drop in oil prices is typically viewed as a sign of easing inflationary pressures, leading to expectations of central bank policy easing. However, macro data from June 2026 directly challenges this logic.
On June 25, the US Department of Commerce reported that the Federal Reserve’s preferred inflation gauge—the core PCE price index—rose 3.4% year-over-year in May, the highest since October 2023. The overall PCE price index climbed 4.1% year-over-year, the highest since April 2023. Core PCE was up 0.3% month-over-month, above April’s 0.2%.
Before the data release, markets widely anticipated core PCE to rise to 3.4% year-over-year. The realization of this expectation did not ease concerns—on the contrary, the confirmation further reinforced the hawkish signals from the Fed’s June policy meeting.
Breaking down the numbers, inflationary pressures are no longer confined to the energy sector. Energy-related goods and services rose 4% month-over-month, still the biggest driver. However, housing costs increased 0.3%, and financial services and insurance prices jumped 1.2%—price increases are spreading from energy to broader consumer sectors. As analysts note, the simultaneous strength in core PCE shows that upward price pressure is not merely a result of short-term energy shocks.
At its June meeting, the Fed kept the federal funds rate target range at 3.50% to 3.75%, but the statement emphasized its commitment to achieving a 2% inflation target. The latest dot plot shows about half of Fed officials expect at least one more rate hike this year. The Fed raised its 2026 core PCE forecast from 2.7% to 3.3%, and now expects inflation won’t reach the 2% target until at least 2028.
Market pricing for rate hikes is equally clear. The probability of a September rate hike has risen to about 48%. Some investment banks forecast two hikes this year. Goldman Sachs expects the earliest hike could come in July.
Why hasn’t the drop in oil prices altered this trajectory? The core reason is that this round of inflation is no longer driven solely by energy prices. The rise in core PCE reflects sticky service prices, wage growth, and housing costs—factors far less sensitive to oil prices than the energy component. As long as core PCE stays above 3% with no clear sign of decline, expectations for rate hikes will be hard to offset by falling oil prices.
The US Dollar Index remained strong after the data, rising to 101.611 on June 24, a 13-month high. A strong dollar itself pressures risk assets—crypto assets are priced in dollars, so a stronger dollar means higher holding costs and weaker marginal demand.
The Real State of the Crypto Market: Multiple Headwinds, Not a Single Variable
As of June 26, 2026, Bitcoin was trading around $59,592, with a 24-hour low of $59,480. During the session, it briefly fell to about $58,200. This is a drop of more than 52% from its all-time high of $126,223 in October 2025. Ethereum likewise fell to around $1,560. The Fear & Greed Index dropped to 18, deep in extreme fear territory.
These price levels are not the result of isolated geopolitical shocks, but rather the accumulation of multiple structural headwinds.
The first is inflation and rate hike expectations. US core PCE for May rose 3.4% year-over-year, a near three-year high. The Fed’s dot plot has turned markedly hawkish, with nearly half of officials supporting a rate hike this year. High interest rates continue to suppress non-yielding crypto assets—as long as real rates are positive and rate hike expectations persist, Bitcoin’s inflation-hedge narrative struggles to outweigh its holding costs.
The second is the correlation with US equities. Asian stock markets plunged in early Friday trading—South Korea’s Kospi fell over 8%, triggering a circuit breaker; Japan’s Nikkei 225 dropped 4.9%; Hong Kong’s Hang Seng Index fell 2.3%. Analysts note that Bitcoin moved in tandem with equities during Asian trading hours, pressured by broad-based risk asset sell-offs. Capital outflows from tech stocks directly spilled over to the crypto market—both share the same pool of risk-seeking capital.
The third is continued institutional outflows. US spot Bitcoin ETFs saw a net outflow of $696.3 million on Thursday, the largest single-day outflow since May 27, extending the streak to six days. Strategy Company’s STRC perpetual preferred shares fell to a record low, down as much as 26% from their $100 par value, and common shares hit their lowest since February 2024. Analysts point out that Strategy remains a source of market anxiety, raising doubts about the sustainability of its dividend and business model.
The fourth is a derivatives market cascade. In early trading on June 26, the crypto market saw a broad sell-off, with BTC sliding from its June 16 high of $67,203 to a low of $58,188. In 24 hours, total liquidations reached $887 million. Other data put the total at about $972 million, with long liquidations accounting for $774 million. A concentrated long-side exit, combined with continued ETF outflows and institutional selling, has completely dried up incremental capital.
The transmission from falling oil prices to the crypto market is not a direct positive, but rather operates through the indirect chain of "inflation expectations → rate expectations → risk asset valuations." The current state of this chain is: oil prices have fallen, but core inflation hasn’t; rate hike expectations haven’t changed; US equities haven’t stabilized; institutions haven’t returned. The macro backdrop for the crypto market has not meaningfully improved as a result of lower oil prices.
From Oil Prices to Crypto Assets: A Structural Look at Transmission Mechanisms
Is there a stable correlation between oil prices and crypto assets? Historical data does not support a simple linear conclusion.
During the cross-asset sell-off driven by energy in March 2026, Bitcoin fell to the mid-$60,000s. Oil price surges during the conflict coincided with crypto declines—both moved in the same direction under the "risk asset sell-off" framework. But does a drop in oil prices mean the reverse will happen? The answer is far from clear.
The key variable is not oil prices themselves, but the monetary policy response and shifts in risk appetite triggered by changes in oil prices. The core issue right now is that falling oil prices have not yet prompted a dovish policy response. The Fed is focused on persistent core inflation—as long as core PCE stays above 3% with no clear downtrend, expectations for rate hikes are unlikely to reverse.
Inventory pressure is another variable that could spark a price rebound. Last week, US Cushing inventories fell to 19 million barrels, about 1 million barrels below the level needed for system stability. TD Securities estimates the world may need to draw down an additional 600 million barrels by October; if inventories fall below key thresholds, oil prices could rebound quickly. Mizuho Securities analysts believe the market is already "oversold" and expect oil prices to return to the $80 range in the coming weeks.
This means the so-called "window of easing" may close before it ever truly opens. For crypto market participants, the focus should perhaps not be on daily oil price swings, but on three more decisive variables: whether the Strait of Hormuz can achieve sustained, safe passage within the 60-day negotiation window; whether core PCE shows a downward trend, altering the Fed’s policy path; and whether US tech stocks stabilize, restoring capital inflows to risk assets.
Conclusion
Eleven days after the US-Iran ceasefire agreement, oil prices have returned to pre-conflict levels—WTI closed at $70.326, briefly touching $69.760. However, a cargo ship attack in the Strait of Hormuz, the IMO’s suspension of evacuation plans, and shipping recovery at just 57% collectively form real supply-side constraints. Meanwhile, core PCE has climbed to 3.4%, a three-year high; the Fed’s rate hike expectations remain unchanged despite falling oil prices; a strong dollar and weak US equities continue to weigh on risk asset valuations.
Bitcoin’s drop below $59,000 and Ethereum’s slide to $1,560 are the results of multiple macro, liquidity, and technical headwinds—not simply a function of a single geopolitical variable. The "illusion of easing" is an illusion precisely because true easing—whether it’s genuine safe passage through the Strait of Hormuz or a directional shift in monetary policy—has yet to materialize.
For crypto market participants, less than one-sixth of the 60-day negotiation window has passed. Until the security situation in the Strait of Hormuz, the trend in core inflation, and the Fed’s policy path become clear, "easing" remains more of an unfulfilled expectation than an established reality.
FAQ
Q: Why didn’t oil prices continue to fall after the US-Iran ceasefire agreement?
After the ceasefire agreement, oil prices quickly dropped back to pre-conflict levels within 11 days. However, on June 25, a Singapore-flagged cargo ship was attacked in the Strait of Hormuz, and the IMO suspended the evacuation of 11,000 seafarers. Shipping has only recovered to 57% of pre-conflict levels. The geopolitical risk premium has not fully disappeared, and oil prices have found support around $70.
Q: Why hasn’t the drop in oil prices triggered a Bitcoin rebound?
Bitcoin is currently under pressure from multiple macro headwinds: US core PCE for May rose 3.4% year-over-year to a three-year high; nearly half of Fed officials support a rate hike this year; US and Asian equities have slumped; spot ETFs saw a single-day net outflow of $696.3 million; and institutions continue to reduce exposure. The drop in oil prices has yet to change the Fed’s policy outlook.
Q: How long will it take for the Strait of Hormuz to fully restore shipping?
The memorandum requires the US to restore shipping to full capacity within 30 days at most. However, after the June 25 attack, the IMO suspended evacuation plans. Current daily average traffic is only at 57% of pre-conflict levels. Shipping companies remain cautious due to safety concerns, making the actual timeline for full recovery highly uncertain.
Q: Under what conditions might the Fed change its stance on rate hikes?
The Fed is focused on the persistence of core inflation, not short-term oil price fluctuations. As long as core PCE remains above 3% and service prices and wage growth stay sticky, expectations for rate hikes are unlikely to reverse. Oil prices would need to remain low for an extended period and filter through to core inflation components before influencing the Fed’s policy path.
Q: Where is the current bottom for the crypto market?
Bitcoin’s key support is in the $58,400–$58,500 range. Analysts note that if $60,000 turns into resistance, traders may look to the $54,000–$56,000 structural support area. Ethereum’s key support is around $1,530. The market is currently in a bearish structure, with weak rebounds and no reversal in the medium-term trend.
