The oil market cast a skeptical eye on the declared Israel-Iran ceasefire, with doubts about its durability driving prices upward after an initial sharp decline. Brent crude, the global benchmark, reflected the cautious sentiment among traders.
The initial sharp drop in Brent crude was a direct response to the perceived de-escalation of tensions following Donald Trump’s announcement. However, reports from Israel of continued missile activity, disputed by Iran, quickly undermined this optimism, leading to a substantial recovery in prices.
This rapid price reversal underscores the market’s sensitivity to the evolving situation in the Middle East. While some of the “war premium” built into oil prices is being unwound, the quick recovery suggests that traders remain highly vigilant to any signs of renewed conflict.
Meanwhile, global stock markets, including the FTSE 100, generally saw an uplift following the ceasefire news, with travel and airline stocks performing particularly well. This indicates a broader market relief, even as the oil market grapples with the complexities of a fragile truce.
Oil Market’s Skeptical Eye: Truce Doubts Drive Prices Upward
