Global Markets Rally as Oil Prices Plunge on Hopes of Iran Deal
According to a report by Axios, United States officials believe an agreement is close that could reopen the strategically vital Strait of Hormuz and ease tensions disrupting global energy supplies.
ERBIL (Kurdistan24) – Global oil prices fell sharply on Wednesday while stock markets surged, as investors reacted to growing optimism that a deal to end the conflict involving Iran may be within reach.
According to a report by Axios, United States officials believe an agreement is close that could reopen the strategically vital Strait of Hormuz and ease tensions disrupting global energy supplies.
International oil benchmark Brent North Sea plunged by double digits to below $100 per barrel before recovering slightly after US President Donald Trump warned of potential renewed military action against Iran. Meanwhile, West Texas Intermediate dropped more than 12 percent to below $90 per barrel before trimming losses.
Equity markets responded positively to the prospect of de-escalation. Major European stock exchanges posted strong gains, with Paris rising nearly three percent, while Frankfurt and London each closed more than two percent higher.
Market sentiment was buoyed by expectations that easing geopolitical tensions could stabilize energy markets and reduce inflationary pressures. Analysts noted that bond yields and the US dollar weakened as investors shifted toward riskier assets.
Axios reported that the potential agreement could take the form of a preliminary memorandum outlining steps to end hostilities and establish a framework for broader nuclear negotiations. The proposal reportedly includes a temporary halt to Iran’s nuclear enrichment activities in exchange for the release of billions of dollars in frozen Iranian assets.
Washington is now awaiting a response from Tehran on key elements of the proposal within the next 48 hours, raising the possibility of a significant breakthrough in the crisis.