Oil prices retreat as Trump confirms framework deal with Iran
The US president’s announcement marks a sharp reversal from earlier threats to target Iranian oil infrastructure, triggering a broad equity rally including a 1.8 per cent jump in the S&P 500.
Oil prices fell on Friday following US President Donald Trump’s announcement that Washington had reached a framework agreement with Iran. The development has raised expectations that tensions in the Middle East could ease, contributing to a broader market rally across global financial centres.
The diplomatic shift represents a significant reversal from earlier threats by Trump to intensify conflict, specifically targeting Iran’s oil industry via Kharg Island. Prior to the announcement, the president had accused Iran of shooting down a US Army AH-64 Apache helicopter over the Strait of Hormuz and vowed retaliation.
The agreement follows a fragile ceasefire that began in April, with negotiators reportedly close to extending the truce. This extension is critical for discussions regarding Iran’s nuclear programme, which Washington and Jerusalem cite as the primary justification for the war. Tehran insists its nuclear efforts are for peaceful purposes, while the US fears its stockpile of highly enriched uranium could lead to an atomic weapon.
Coinciding with the diplomatic news, global equity markets experienced a sharp reversal. Wall Street’s S&P 500 index rose nearly 1.8 per cent, recording its largest single-day gain since the escalation began. The rally underscores investor appetite for stability after days of heightened military rhetoric.
Iran has insisted that any deal must also end fighting in Lebanon between its ally Hezbollah. While the framework agreement signals progress, the specific terms remain undisclosed, and Tehran’s pushback suggests the path to a final resolution remains complex.
