Oil prices plunged more than four percent Monday, while Asian stocks soared in early trade after the United States and Iran announced they had reached an agreement to end the conflict in the Middle East.
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At 0045 GMT, US benchmark West Texas Intermediate was down 4.70 percent at $80.89 a barrel and North Sea Brent Crude sunk 4.03 percent to 83.81 percent.
Meanwhile, Japan’s Nikkei 225 index jumped 4.99 percent and South Korea’s benchmark Kospi index soared 5.54 percent.
That came after mediator Pakistan said the United States and Iran agreed to a peace deal and an “immediate and permanent” end to military operations on all fronts, including Lebanon.
“The Deal with the Islamic Republic of Iran is now complete,” US President Donald Trump swiftly confirmed with his own statement on Sunday.
Trump also announced that the strategic Strait of Hormuz — a vital maritime chokepoint through which roughly 20 percent of the world’s crude oil supply transits — would reopen.
“I hereby fully authorize the toll free opening of the Strait of Hormuz, and, simultaneously herewith, authorize the immediate removal of the United States Naval blockade. Ships of the World, start your engines. Let the oil flow!”
Soon after, Iran said that the newly announced agreement with the United States put an “immediate end” to the countries’ war.
“This is a first step deal, not a final peace settlement,” Stephen Innes of SPI Asset Management said.
“The market will now trade verification,” he said including the official signing in Switzerland, mine clearance and Israeli restraint.
“It is a marketable ceasefire framework that kicks the hard problems down the road. Iranian compliance, and Hezbollah quiet.”
