Oil Jumps, Stocks Waver as Iran-US Tensions Keep Investors on Edge

Oil Jumps, Stocks Waver as Iran-US Tensions Keep Investors on Edge

Global oil prices climbed sharply on Friday, with Brent crude nearing $110 per barrel, as investors reacted cautiously to Donald Trump’s decision to delay a potential military strike on Iran—a move that has extended uncertainty across global financial markets.

Crude initially dipped in early trading but rebounded strongly as European markets opened, highlighting continued volatility driven by geopolitical tensions. Since the escalation of the Middle East conflict on February 28, Brent crude prices have surged significantly, reflecting fears of disruptions to global energy supply.

At the centre of these concerns is the Strait of Hormuz, a vital oil transit route responsible for nearly 20 percent of the world’s oil and gas shipments. Any instability in the corridor poses a direct threat to global energy security.

The White House confirmed that Trump has postponed planned strikes on Iranian energy facilities until April 6, citing “positive” diplomatic signals. However, officials in Tehran have denied that meaningful negotiations are ongoing, raising doubts about the effectiveness of the delay.

In a post on Truth Social, Trump claimed discussions were progressing and said the extension followed a request from Iran. The decision marks the second delay in recent days, fuelling market uncertainty and investor scepticism over Washington’s strategy.

Iran, through state-linked channels, acknowledged responding to a US proposal via intermediaries. Its reported demands include an end to US-Israeli attacks, war reparations, and recognition of its control over the Strait of Hormuz—conditions analysts say are unlikely to be fully accepted.

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Despite diplomatic signals, military tensions remain elevated. The Pentagon is reportedly considering deploying up to 10,000 additional troops to the region, underscoring the continued risk of escalation in the Middle East.

Global stock markets showed mixed reactions to the unfolding crisis. Major Asian indices in Tokyo and Seoul declined amid risk-off sentiment, while European markets recorded modest gains, supported by energy stocks benefiting from rising oil prices.

Analysts warn that the delay offers little clarity. Market strategist Stephen Innes described the development as “time bought, not clarity,” noting that investors are becoming increasingly wary of shifting US policy signals.

The Organisation for Economic Co-operation and Development warned that sustained high oil prices could push US inflation above four percent this year, complicating economic recovery and monetary policy.

Meanwhile, the World Trade Organization cautioned that global trade is facing its worst disruption in decades due to rising energy costs and geopolitical tensions. The World Bank has also indicated readiness to support economies most vulnerable to the ongoing crisis.

Governments worldwide are introducing emergency measures to cushion the impact of rising fuel prices. India has reduced fuel taxes, while Vietnam has cut environmental levies. Japan is considering easing restrictions on coal-fired power plants to stabilise electricity supply. In Europe, Spain and Poland have rolled out support packages aimed at shielding households and businesses from escalating energy costs.

Energy analysts also note that some countries are tapping strategic reserves, while pressure is mounting on oil-producing nations to increase output—though supply constraints may limit any immediate response.

With global oil prices, Middle East tensions, and market volatility dominating investor sentiment, financial markets remain highly sensitive to geopolitical developments. Traders are closely monitoring whether diplomatic efforts will lead to de-escalation or merely delay a broader conflict. For now, the global economy remains caught between fragile diplomacy and the persistent threat of disruption in one of the world’s most critical energy corridors.

Oil Jumps, Stocks Waver as Iran-US Tensions Keep Investors on Edge