Oil prices plunge and shares jump on US-Iran ceasefire plan
Global oil prices have fallen sharply and stock markets have jumped after the US and Iran agreed to a conditional two-week ceasefire deal that includes the reopening of the key Strait of Hormuz waterway.
The price of benchmark Brent crude fell by about 13per cent to $94.80 (£70.73) a barrel, while US-traded oil was more than 15per cent lower at $95.75.
But oil prices remain higher than before the conflict started on 28 February. At the time, it was trading at around $70 a barrel.
The cost of energy has jumped as oil and gas supplies from the Middle East have been severely disrupted after Iran threatened to attack ships trying to use the strait in retaliation to US and Israeli airstrikes.
Stock markets in Europe opened higher following sharp rises in Asia. London’s FTSE 100 share index jumped by 2.53 per cent in opening trade. In France, the Cac gained 4per cent while Germany’s Dazx rose by nearly 5per cent.
Japan’s Nikkei 225 gained 5per cent while South Korea’s Kospi jumped nearly 6per cent. Hong Kong’s Hang Seng was up 2.8per cent, while the ASX 200 in Australia gained 2.7per cent.
US stock market futures also pointed to a higher open for Wall Street.
Futures contracts are an agreement to buy an asset for a set price at a later point in time. In the case of US stock futures, they can indicate the direction of the market before it opens.
In a social media post on Tuesday evening, Trump said: “I agree to suspend the bombing and attack of Iran for a period of two weeks… subject to the Islamic Republic of Iran agreeing to the COMPLETE, IMMEDIATE, and SAFE OPENING of the Strait of Hormuz”.
He had set a deadline for 20:00 EDT on Tuesday (00:00 GMT on Wednesday), threatening that “a whole civilisation will die tonight” if no deal was reached.
Iranian Foreign Minister Abbas Araghchi said on social media that Tehran will agree to a ceasefire “if attacks against Iran are halted”, adding that safe passage through the Strait of Hormuz “will be possible”.
