Oil prices climb as stocks drop amid US-Iran ceasefire concerns

Global Oil Market – (Web Desk) – Oil prices went up and stock markets dropped on Thursday. People are worried the new US-Iran ceasefire might not last. Iran threatened to restart fighting after Israel launched heavy attacks on Lebanon.

Just one day earlier things looked very different. Markets jumped and oil prices fell after President Trump announced a two-week pause in the war. Iran also agreed to reopen the Strait of Hormuz so ships could pass through safely.

But the deal started falling apart almost immediately. Israel said the ceasefire did not cover its war against Hezbollah in Lebanon. It kept attacking its northern neighbour anyway.

Vice President JD Vance backed Israel up. He said Lebanon had nothing to do with the ceasefire. He made it clear the US never included it in the deal.

Iran strongly disagreed. It said Israel’s attacks broke the terms of the agreement. Reports then came in that the Strait of Hormuz was closed again. Around one fifth of the world’s oil and gas travels through that waterway. Iran said it was closing the route because of sea mines nearby and offered ships alternative paths instead.

Iran’s parliament speaker Mohammad Bagher Ghalibaf posted on X that the deal had already been broken. He said further talks made no sense now. He pointed to three reasons. First Israel kept fighting in Lebanon. Second a drone entered Iranian airspace. Third the US refused to recognise Iran’s right to enrich uranium.

Hezbollah said Thursday it had fired rockets towards Israel in response to its “violation”.

Meanwhile, a senior US official said Tehran’s 10-point plan was not the same set of conditions the White House had agreed to.

Fears that the ceasefire could fall apart while crude remains stuck in Hormuz saw West Texas Intermediate oil jump around three percent Thursday, having plunged more than 16% the day before. Brent was up more than two percent following a 13% drop.

Equities also gave up some of their gains.

Tokyo, Hong Kong, Shanghai, Sydney, Singapore, Seoul and Taipei were all down.

Attention is also turning to crunch talks in Pakistan that are expected on Friday or Saturday, with Vance leading the US delegation.

“Many questions remain with the 10-point plan that Trump has received from Iran (which includes Iranian control of the Strait of Hormuz, US acceptance of Iran’s uranium enrichment programme, the end of all sanctions and withdrawal of the US military from the Gulf region) is at odds with Trump’s 15-point peace plan,” wrote National Australia Bank’s Skye Masters.

US Vice President Vance to Visit Pakistan Tomorrow

Still, observers warned that an end to the conflict would not see a quick return to normal, with crude prices still elevated and key regional infrastructure targeted that could take billions of dollars and at least months to repair.

Shipping journal Lloyd’s List estimated around 800 ships have been stuck in the Gulf since the end of February, when hostilities broke out.

Still, FOREX.com analyst Fawad Razaqzada said: “Investors are confident that oil prices could ease further and the Strait of Hormuz will re-open again and hopefully stay open beyond the two-week ceasefire period.”