ISLAMABAD: The international crude oil plunged sharply this morning, while the stock markets and crypto trading turned bullish after the announcement of the US-Iran ceasefire. Pakistan announced the ceasefire while Donald Trump announced the suspension of attacks on Iran from today.
Global financial markets surged on Wednesday after a two-week ceasefire between the United States and Iran triggered a wave of investor optimism and eased concerns over energy disruptions.
The crude oil prices plunged below $100/barrel, to around $96 this morning, while stocks and crypto markets surged signficantly with bullish trading sentiments.
The agreement, announced by Donald Trump, raised hopes that flows through the vital Strait of Hormuz could resume. This strategic passage typically carries around 20% of the world’s oil and gas, making it central to global energy stability.
As a result, oil prices plunged sharply. US crude futures fell about 16% to $94.59 per barrel, while Brent crude dropped 15% to $92.35. Meanwhile, equity markets reacted positively, with S&P 500 futures rising more than 2% and European futures jumping over 4%.
In Asia, Japan’s Nikkei index surged roughly 5%, while South Korea’s Kospi climbed 6%, briefly triggering a trading halt. Consequently, MSCI’s broad Asia-Pacific index excluding Japan gained 4%, reflecting widespread optimism.
At the same time, the US dollar weakened as investors moved away from safe-haven assets. Bond markets also rallied, with yields on US 10-year and 2-year Treasury notes falling to multi-week lows.
However, analysts urged caution despite the relief rally. Martin Whetton of Westpac said investors are unlikely to take significant risks without signs of lasting peace. Similarly, Charu Chanana of Saxo noted that sustained progress in negotiations and the return of tanker traffic would be key indicators of stability.
Although gold prices rose over 2%, signaling lingering uncertainty, currency markets showed renewed risk appetite, with the euro and Australian dollar gaining ground.
Nevertheless, experts such as Carol Kong of Commonwealth Bank of Australia warned that unresolved tensions could still trigger renewed escalation, keeping markets on edge in the coming weeks.
