OIL AND STOCKS MOVE ON IRAN DEAL HOPES

Global stocks rose Monday while oil prices and the U.S. dollar fell as investors reacted to signs that the United States and Iran may be moving closer to a deal that could reopen the Strait of Hormuz. Reuters reported that the market rally was driven by improved risk sentiment, though uncertainty remained over when, or whether, the waterway would fully reopen.

The Strait of Hormuz remains central to the market reaction because of its role in global energy trade. Before the war, the route carried about one-fifth of global oil and liquefied natural gas shipments, according to Reuters. The nearly three-month conflict has pushed energy prices higher and changed the outlook for inflation and interest rates across major economies.

Oil prices fell sharply as traders responded to the diplomatic signals. Reuters reported that Brent crude futures dropped by about $6, or roughly six percent, to $97.55 a barrel, while U.S. West Texas Intermediate fell to $90.97. The Guardian also reported Brent below $100, describing it as the lowest level in about two weeks.

Stock markets moved in the opposite direction. Japan’s Nikkei rose about three percent and passed the 65,000 level for the first time, while Taiwan stocks also closed at a record high, according to Reuters. Gulf markets also gained, with Dubai, Abu Dhabi, Bahrain, and Oman advancing as investors priced in reduced geopolitical risk.

The market optimism remains cautious. Reuters reported that analysts still expect oil prices to stay elevated even if a deal is reached, because disrupted shipping, supply chains, and energy infrastructure may take time to normalize. The same uncertainty is affecting central-bank expectations, with inflation concerns shifting market assumptions away from earlier hopes for rate cuts.

For now, investors are reacting to the possibility of de-escalation rather than a confirmed settlement. If talks progress, lower energy prices could ease pressure on inflation and import-heavy economies. If talks stall, the market reaction could reverse quickly, especially in oil, shipping, currencies, and energy-sensitive equities.

[IMG]https://vepbrgvfdbpwzesrqysv.supabase.co/storage/v1/object/public/article-images/1779721533581-kzq0wtw9ar.png||Mission Offline Desk[/IMG]