Oil futures cracked on Tuesday night after President Trump suspended a massive bombing campaign against Iran and declared a two-week ceasefire in the US-Iran war.
“I agree to suspend the bombing and attack on Iran for two weeks,” Trump wrote on Truth Social. Tuesday evening, about an hour ahead of his 8 p.m. ET deadline, “It will be a two-pronged cease-fire! The reason for doing so is that we have already met and exceeded all military objectives, and are very far from a definitive agreement on long-term peace with Iran, and peace in the Middle East.”
International benchmark Brent crude (BZ=F) futures fell more than 16% to trade at $90.78 a barrel. Futures on the US benchmark, West Texas Intermediate (WTI) crude (CL=F), also fell 16% to trade above $94.
Stocks also rose on the news, with futures on the S&P 500 (ES=F) and the tech-heavy Nasdaq 100 (NQ=F) jumping nearly 2%, while contracts on the Dow Jones Industrial Average (YM=F) rose more than 900 points..
As the two-week ceasefire continues, the Strait of Hormuz, through which 20% of the world’s oil supply passes, remains a point of contention.
“Based on conversations with Prime Minister Shahbaz Sharif and Field Marshal Asim Munir of Pakistan, and where they asked me to stop the destructive force being sent to Iran tonight, and the Islamic Republic of Iran agreed to the full, immediate and safe opening of the Strait of Hormuz,” Trump wrote.
He added that the U.S. “has received a 10-point proposal from Iran, and believes it is a viable basis for negotiations that will bring this long-term problem closer to resolution.”
This comes after President Trump posted on Truth Social on Tuesday morning, where he wrote, “An entire civilization will die tonight, never to be brought back. I don’t want that to happen, but it’s possible.”
The president also wrote, with some taking the strike as an opening for possible pre-emptive talks, “Now that we have a complete and total regime change, where different, smarter and less radical minds dominate, maybe something revolutionary wonderful will happen, who knows?”
Earlier this evening, Iran’s leadership on Tuesday pulled itself out of the talks and was unwilling to discuss a temporary ceasefire, the New York Times reported, a complete end to the war and the payment of reparations for damages, among other conditions.
