Oil Retreats From $108 as US-Iran Deal Reports Lift Global Markets

BBC Business reported Wednesday that oil prices fell sharply and equities surged worldwide after reports emerged that Washington and Tehran are approaching a framework agreement to end their active conflict.

Brent crude, the global benchmark, slid from above $108 per barrel to below $100 in early trading. The move still leaves prices well above the roughly $70 level seen before the conflict began in late February.

Markets React Across Three Continents

European indexes led the equity gains. London’s FTSE 100 climbed more than 2%, while Germany’s DAX and France’s CAC 40 each added close to 3%. The S&P 500 opened nearly 1% higher in New York. Asian markets had already closed in positive territory, with South Korea’s Kospi surging 6.45%, Hong Kong’s Hang Seng gaining 1.22%, and Japan’s Nikkei edging up 0.38%.

The catalyst was a report from Axios that the US believes it is nearing a one-page memorandum of understanding to end hostilities. That document, according to sources cited by Axios, would formally declare an end to the war and open a 30-day negotiating window covering the Strait of Hormuz, Iran’s nuclear programme, and the lifting of US sanctions. The US is reportedly awaiting Iranian responses on several outstanding points within 48 hours.

A Conflict That Has Choked Global Energy Flows

The US-Israeli military campaign against Iran launched on 28 February has effectively closed the Strait of Hormuz, the narrow waterway through which roughly a fifth of global oil and gas shipments normally pass. Iran’s threat to attack tankers transiting the strait drove a sharp spike in both oil and gas prices and weighed heavily on European stock markets, which remain below their end-of-February levels even after Wednesday’s rally.

A brief ceasefire on 8 April briefly calmed markets, but tensions reignited after President Donald Trump announced “Project Freedom,” an operation to escort commercial vessels through the strait by US military force. Strikes on Iranian fast boats followed, and the United Arab Emirates accused Iran of attacking one of its oil ports, a claim Tehran denied. Trump paused the operation Tuesday, citing progress toward a “Complete and Final Agreement.”

Caution Remains the Watchword

Secretary of State Marco Rubio told reporters Tuesday that the initial offensive phase had concluded and that Washington prefers a negotiated outcome. Iran’s parliamentary speaker Mohammad Ghalibaf gave a harder public line, suggesting Tehran saw no urgency to settle. Analysts note that market moves, while significant, remain measured given how many prior signals of progress have faded.

Nothing has been signed. The next 48 hours are likely to determine whether this rally holds.

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