Stocks Market
Crude Oil Slides More Than 6% as Washington and Tehran Calm Tensions, Asian Markets Surge
<p>Oil prices plunged over 6% on Monday after three consecutive nights without any US strikes on Iran, signaling a tentative de‑escalation in the region. Brent slipped to $90.90 a barrel and U.S. WTI fell to $83.85, while Asian equities rallied, led by a dramatic surge in Chinese memory‑chip maker CXMT.</p><p>Analysts point to several factors – the halt of US strikes, upcoming mid‑term elections, and growing diplomatic activity – that could sustain lower oil prices and boost risk‑on sentiment across Asian markets.</p>
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Oil Prices Drop Sharply
At around 06:30 GMT, Brent crude, the global benchmark, fell 6.08 % to $90.90 per barrel. The U.S. counterpart, West Texas Intermediate (WTI), slipped 6.11 % to $83.85.
Geopolitical backdrop
After two weeks of intensive U.S. airstrikes on Iran, no new strikes were reported since Friday night. Iranian army spokesperson Mohammad Akraminia said the Iranian forces had halted operations because their “strategy is essentially retaliatory.”
U.S. Ambassador to the United Nations, Mike Waltz, indicated that President Donald Trump is leaving “room” for talks with Tehran, even as he warned that the U.S. has not abandoned the possibility of further escalation.
Analyst view
MUFG analyst Michael Wan described the weekend pause in strikes as a “significant event,” noting that the baseline scenario is a “gradual de‑escalation.” He highlighted several drivers of the calm:
- U.S. military may be low on ammunition for a full‑scale war.
- Mid‑term elections are approaching, and Trump has little incentive to keep oil prices high.
- Middle‑East and Gulf states generally prefer stability.
- China appears to be playing a larger diplomatic role.
Secondary risk: Houthi blockade
Compounding the market’s worries is the Houthi rebel blockade of Saudi ports, a move backed by Iran. The June 17 agreement between Washington and Tehran had previously helped push Brent just over $70, but renewed clashes later in July sent prices soaring again.
Market reaction
The oil slump revitalised Asian equity markets, which had been weakened by a recent tech‑sector sell‑off and higher crude prices.
"If inflation concerns ease and investor confidence improves, we can expect buying in cyclical stocks," said experts at Tokai Tokyo Securities.
- Tokyo’s Nikkei rose 0.5 % to 64,931 points.
- South Korea’s Kospi gained 0.97 %.
- Sydney’s index climbed 1.39 %.
- Hong Kong’s Hang Seng was up 1.01 % at 06:30 GMT.
Currency markets
The Japanese yen recovered 0.17 % to ¥163.56 per dollar after slipping to a 40‑year low last week.