Global Markets Rally and Oil Prices Drop 6% on Hopes of US-Iran De-escalation

Global stock markets rose and oil prices fell sharply on Wednesday as investors reacted to the first signs of potential de-escalation in the nearly four-week-old conflict between the United States, Israel, and Iran, with Brent crude dropping below $100 per barrel for the first time since hostilities intensified. The market shift followed two developments: reports that Washington had transmitted a 15-point peace proposal to Tehran, and Iran's announcement that it would allow "non-hostile" oil tankers to pass through the Strait of Hormuz, which Iran had largely blocked since the conflict began. U.S. President Donald Trump expressed optimism in the Oval Office, telling reporters that officials were "in negotiations even as we speak." Iranian authorities, however, did not confirm any official talks, with some military spokespersons dismissing the claims.

The conflict between the United States, Israel, and Iran began on February 28, 2026, in what was designated Operation Epic Fury. The strikes killed Ali Khamenei, Iran's longtime Supreme Leader, and Mojtaba Khamenei, his son, was appointed to the position on March 9, 2026. The Strait of Hormuz has long been considered one of the world's most critical energy chokepoints, with roughly one fifth of global oil and gas supply transiting through it. Iran's ability to restrict passage through the strait has historically been a central element of its strategic leverage in any confrontation with Western powers.

Trump cites a mysterious 'gift' from Tehran Trump described a development he called a "gift" that arrived from Iran, speaking to reporters in the Oval Office without providing specific details beyond confirming it related to the Strait of Hormuz. „They did something yesterday that was actually amazing. They gave us a gift, and the gift arrived today. And it was a very big gift, worth an enormous amount of money. To me, that meant only one thing: we are dealing with the right people.” — Donald Trump via Mediafax.ro The New York Times, citing anonymous officials, reported that the 15-point peace proposal was transmitted to Tehran through Pakistan. Israeli broadcaster Channel 12 reported that Trump was proposing a one-month armistice during which Iran would surrender its enriched uranium, halt further enrichment, and guarantee safe passage through the Strait of Hormuz. The same report indicated that Iran would receive the lifting of all sanctions and assistance in developing civilian nuclear energy under the proposed terms. Despite the diplomatic signals, violence continued, with an Iranian missile injuring several people in Israel, and Israel in turn applying pressure on multiple fronts.

Tokyo and Seoul surge more than 3% on the news Stock markets across Asia posted broad gains as investors responded to the prospect of reduced conflict risk. Markets in Tokyo and Seoul at one point rose by more than three percent, while Hong Kong, Sydney, Shanghai, Singapore, Wellington, and Taipei also recorded increases. Analysts cautioned, however, that the optimism remained fragile and conditional. „The markets have tentatively repriced based on a slightly higher probability of de-escalation, but conviction remains low.” — Chris Weston via Mediafax.ro Chris Weston is an analyst at Pepperstone. Analysts also noted that the arrival of additional American troops in the region indicated that the risk of further escalation had not been eliminated. Both main crude oil contracts fell by more than six percent on the day, with Brent returning below the $100-per-barrel threshold.

Economic strain mounts after nearly four weeks of conflict The broader economic impact of the conflict has accumulated steadily over nearly four weeks of hostilities. Governments around the world have begun seeking to reduce energy consumption in response to the disruption of oil and gas flows through the Strait of Hormuz, which carries roughly one fifth of global supply. Airlines have cut the number of flights, reflecting both elevated fuel costs and security concerns over airspace in the region. The dramatic rise in global energy prices has fueled fears of a new wave of inflation in economies already under pressure. Iran's decision to allow "non-hostile" tankers through the strait represented the first concrete operational concession since the conflict began, even as the broader military situation remained unresolved. The gap between Trump's public optimism and the absence of any Iranian confirmation of formal negotiations left markets and analysts in a state of cautious, low-conviction repositioning rather than a decisive shift in sentiment.