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Crude oil prices dropped significantly after President Donald Trump announced a two-week suspension of planned strikes on Iran, conditional on Tehran reopening the Strait of Hormuz.
US crude futures fell below $100 a barrel, reversing recent gains driven by weeks of heightened tensions around this critical shipping route, which handles roughly a fifth of global oil flows.
The announcement provided relief to global markets. Futures linked to major US indexes rose over 2 per cent, signalling investor optimism after days of volatility.
Asian markets also responded positively, with Japan’s Nikkei and South Korea’s Kospi recording notable gains.
The Strait of Hormuz, long a focal point of regional tension, had restricted passage in recent weeks, contributing to rising oil prices and supply concerns.
Analysts note that the two-week pause offers a narrow window for diplomacy to stabilise the situation, though the risk of renewed escalation remains.
Gold prices also rose amid continued uncertainty, while equities gained as the immediate threat of conflict eased.
However, reports of missile and drone activity in parts of the Gulf underscore that the ceasefire remains fragile and contingent on both sides avoiding further provocation.
The temporary lull provides a brief opportunity for calmer global energy markets, yet volatility is expected to persist until a longer-term resolution is reached.
For India, heavily reliant on Gulf crude imports, this development could influence inflation, currency stability, and broader economic growth.
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