Ceasefire Hopes Drive Oil Prices Down, Stocks Up

Global oil prices fell and stock markets climbed on Wednesday after a cease-fire agreement in the conflict involving Iran eased immediate concerns about energy flows from the Persian Gulf. The deal raised expectations that shipments could resume after disruptions tied to the Strait of Hormuz, a key route for oil and gas transport.

Officials said the agreement was reached 90 minutes before a U.S.-imposed deadline. Under the terms described, the United States will pause strikes on Iran for two weeks, and Iran will allow vessels to transit the Strait of Hormuz. Shipping through the strait had been halted since the conflict began, tightening supply expectations in global energy markets.

In oil trading, Brent crude, the global benchmark, was around $95 per barrel, a decline of 13 percent. West Texas Intermediate, the U.S. benchmark, fell about 15 percent to roughly $96 per barrel. Even after the pullback, both contracts remained well above levels seen before the conflict, with Brent still up 30 percent and WTI up over 40 percent.

The Strait of Hormuz typically carries one-fifth of global oil supply, making any disruption there a major factor for prices and energy security. The cease-fire terms tied directly to transit through the waterway helped shift market expectations toward improved near-term availability. That change in outlook coincided with a broad move into risk assets across regions.

Equity markets advanced worldwide. Europe’s Stoxx 600 rose 3.5 percent, and S&P 500 futures pointed to a 2.5 percent gain at the U.S. open. In Asia, where many economies depend heavily on imported oil and gas, Japan’s Nikkei 225 climbed 5.4 percent and South Korea’s Kospi Index rose nearly 7 percent.

In the United States, fuel costs did not immediately mirror the drop in crude. Data shows the national average gasoline price rose to $4.16 per gallon, up 40 percent since the conflict began, while diesel increased 51 percent to $5.67. The divergence highlights that retail fuel prices can remain elevated even when crude retreats, particularly after a sharp run-up.

Key uncertainties remain centered on implementation and duration. The agreement specifies a two-week suspension of U.S. strikes and hinges on Iran permitting vessel transit, leaving markets sensitive to any change in shipping conditions in the Strait of Hormuz. For now, the combination of lower crude prices and higher equities reflects a shift in expectations toward reduced immediate disruption risk, while energy and transport costs remain a focus for households and businesses.