Global markets respond positively after a two-week ceasefire agreement restores calm to the Strait of Hormuz.
World oil prices tumbled sharply while stock markets surged following a US-Iran agreement on a two-week ceasefire, which includes re-opening a crucial shipping route through the Strait of Hormuz.
Brent crude, the global benchmark, fell by around 13% to $94.80 a barrel, while US crude futures dropped more than 15% to $95.75 a barrel.
Despite the decline, oil prices remain higher than before the conflict erupted on February 28, when Brent traded at roughly $70 a barrel.
Major Asia-Pacific stock indices rose strongly on Wednesday morning. Japan’s Nikkei 225 jumped 5%, South Korea’s Kospi climbed nearly 6%, Hong Kong’s Hang Seng advanced 2.8%, and Australia’s ASX 200 increased by 2.7%.
US stock futures also pointed to a higher open on Wall Street. Energy prices had soared in recent weeks due to severe supply disruptions from the Middle East, after Iran threatened attacks on vessels attempting to navigate the Strait in response to US and Israeli airstrikes.
Gold prices climbed more than 2% to $4,812 an ounce. Cryptocurrencies also strengthened: Bitcoin rose 2.9% to $71,327, while Ethereum jumped 5.6% to $2,234.
The ceasefire came after Iran agreed to a temporary truce following US President Donald Trump’s announcement of a pause in strikes.
