Oil prices tumble as global markets rebound after Trump halts Iran strikes

OIL PRICES TUMBLED and European stock markets have rebounded in volatile trading after US President Donald Trump suddenly ordered a halt to strikes on Iranian energy infrastructure after claiming “very good” talks with Tehran.

Crude futures plunged more than 14% after Trump’s comments on his Truth Social platform, a sharp contrast to his threatening talk over the weekend.

However, they later pulled back to trade down around 8% as Iran denied negotiations had taken place. European gas prices also dropped by around 4% during the same time.

Stock markets responded positively to the news with shares in Dublin (the ISEQ has jumped up by 2.5% since yesterday), Paris and Frankfurt gaining ground.

The rebound lost some steam after Iranian media said there had been no talks between Tehran and Washington.

“It’s incredibly difficult to trade these markets when Trump is swinging between massive escalation and declaring peace/victory… but the market is happy for now that we do not enter a new phase of danger,” said Saxo UK investor strategist, Neil Wilson.

Analyst Patrick O’Hare at Briefing.com said the stock market “is reading between the lines of everything and is sensing an off-ramp moment, sooner rather than later.”

Ahead of Trump’s update, the International Energy Agency warned of the worst global energy crisis in decades.

Trump on Saturday gave Iran 48 hours to reopen the Strait of Hormuz to shipping or face the destruction of its energy infrastructure.

The ultimatum came as the waterway, through which a fifth of global oil and liquefied natural gas flows, remained effectively closed.

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Iran warned Hormuz “will be completely closed” should Trump act on his threat.

Observers have raised the prospect of surging inflation as oil prices remain far above pre-war levels despite Monday’s plunge.

This in turn could see central banks hike interest rates, potentially triggering a fresh cost-of-living crisis.

Disruption to fertiliser shipments has fanned concerns about global food security.

The prospect of higher borrowing costs has hammered the price of non-yielding gold but the precious metal recovered some of its losses after Trump’s latest comments, which also reversed the direction of the dollar.

As Wall Street opened for trade, the greenback dropped against the euro, British pound and yen, having earlier risen.

Yields on 10-year government bonds, which have been surging on inflation concerns, pulled back slightly.

“As government bonds… see yields rise, it makes gold less attractive given that gold pays no interest,” said Susannah Streeter, chief investment strategist at Wealth Club.

“Investors who have made losses elsewhere in volatile markets are selling to cover positions.”

Here, Tánaiste Simon Harris is expected to announce a time-limited cut to fuel excise duty, along with a rebate scheme for hauliers hit by recent price spikes.

The measures, which may initially run for a number of weeks, come after a surge in petrol and diesel costs linked to the oil markets disruption.