Oil prices fell sharply on Thursday after the United States and Iran approved a deal aimed at ending hostilities. The agreement is expected to restore shipping through the Strait of Hormuz and ease supply concerns. However, global equity markets remained under pressure as investors reacted to a tougher US interest rate outlook.
Crude futures dropped about two percent as traders welcomed signs of stability in the Middle East. The reopening of the Strait of Hormuz is expected to improve the flow of oil and cargo shipments. As a result, fears of supply disruptions that previously pushed energy prices higher began to fade.
Meanwhile, stock markets delivered a mixed performance across Europe and Asia. Investor sentiment weakened after the US Federal Reserve raised its inflation forecast and signaled higher interest rates this year. The central bank’s stance strengthened the dollar and reduced appetite for riskier assets.
Federal Reserve Chairman Kevin Warsh said the institution remains focused on controlling inflation despite political pressure for lower borrowing costs. Analysts noted that expectations of tighter monetary policy surprised markets and triggered declines on Wall Street. Investors also remained cautious after recent interest rate decisions by major central banks.
In regional trading, South Korea’s Kospi index surged more than two percent and crossed the 9,000-point mark for the first time. Gains were driven by strong demand for semiconductor stocks as artificial intelligence investment continues to expand. Japan’s stock market also reached a record milestone, closing above 71,000 points for the first time.