Global oil prices experienced a significant decline as Asian stock markets climbed, fueled by expectations that a resolution to the US-Israel conflict with Iran is nearing. US Secretary of State Marco Rubio indicated that negotiators are reviewing a substantial proposal, suggesting a potential agreement could be finalized shortly.
Brent crude dropped 5.5% to $97.90 per barrel on Monday, while US-traded crude saw a 5.9% decline to $90.93. President Donald Trump noted that the prospective deal includes the reopening of the Strait of Hormuz, a critical maritime passage that has been largely obstructed since late February.
Despite these developments, Iranian foreign ministry spokesperson Esmail Baqai cautioned that while many issues are resolved, an immediate signing is not guaranteed.
President Trump confirmed recent discussions with regional leaders and Israeli Prime Minister Benjamin Netanyahu regarding a memorandum on peace. Although market sentiment has improved, experts advise caution.
Saul Kavonic of MST Financial noted that even if stability returns, the energy market will likely remain restricted through 2027 due to necessary facility repairs and the replenishment of depleted reserves.
Furthermore, maritime analyst Lars Jensen suggested that shipping companies will likely proceed with extreme wariness regarding the Persian Gulf, even if a formal deal is reached, citing potential risks like sea mines.
In response to the positive news, Japan’s Nikkei 225 index surpassed 65,000 points.
Meanwhile, public holidays in the UK and US kept Western financial markets closed for the day.
