Oil Prices Drop and US Futures Rally on Trumps Israel-Iran Ceasefire Post

Highlights:

• Oil prices slid more than 3% after Trump claimed a ceasefire between Israel and Iran would begin within six hours.
• US equity futures jumped, with tech and broad-market indices rising over 1% in after-hours trading.
• Market sentiment shifted sharply, driven by hopes of de-escalation in the Middle East and reduced geopolitical risk.

Market reacts swiftly to social media announcement of de-escalation in the Middle East

Oil prices tumbled and US futures surged after former US President Donald Trump announced on social media that a ceasefire between Israel and Iran would commence within six hours. According to Trump, the ceasefire would mark the end of hostilities in the region. The announcement came after the close of US trading, triggering sharp movements in after-hours markets.

Energy Markets Respond to De-escalation Hopes

Crude oil, which had been under pressure due to ongoing geopolitical uncertainty, extended its decline on renewed hopes for peace. Investors had been pricing in elevated risk premiums due to fears of a broader Middle East conflict that could disrupt global oil supplies. Trump’s post immediately changed the

sentiment, leading to a sell-off in crude. At the time of writing, oil futures were down significantly, with Brent crude dropping by over 3% and West Texas Intermediate (WTI) sliding below $80 per barrel. The retreat in prices reflects market optimism that a ceasefire would reduce geopolitical tensions and supply concerns.

Equity Futures Jump on Risk-On Sentiment

Meanwhile, US equity futures rallied strongly in after-hours trading. Tech-heavy NASDAQ and S&P 500 futures both recorded gains of more than 1% as traders responded to the prospect of geopolitical stability. A ceasefire would likely ease inflationary pressures tied to energy costs and bolster investor confidence. While no official confirmation of the ceasefire had been issued by either government at the time of writing, Trump’s post was enough to significantly shift market dynamics overnight. Investors will now closely watch for formal diplomatic statements and signs of lasting peace.

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