On the morning of 23/3 US time, US President Donald Trump announced the cancellation of a "48-hour ultimatum" to Iran. Writing on the Truth Social network, he stated that "effective" negotiations had taken place over the past two days.

Trump further stated, "I have instructed the Department of War to postpone all military strikes against Iran's power plants and energy infrastructure for a period of 5 days, contingent on the success of ongoing meetings and discussions."

Following this announcement, crude oil prices immediately plunged. Brent crude at one point dropped over 13%, falling below USD 97 per barrel, before currently trading around USD 105. Similarly, WTI crude fell over 9%, to below USD 90 per barrel, before recovering above that mark.

Brent crude prices (USD/barrel) from 19/3 to present. *Source: Trading Economics*

Other global markets also reacted in unison. US stock futures, including the Dow Jones Industrial Average, rose 1,100 points, equivalent to 2,6%. S&P 500 and Nasdaq-100 futures both increased by 2,7%.

In Europe, the STOXX Europe 600 index also reversed its early trading losses to rise. The index is currently up 0,7%, after falling over 2,2% earlier in the trading session.

The USD plunged, with the US Dollar Index falling 0,3%, after previously rising 0,6%. The Euro increased over 1%, reaching USD 1,158, from approximately USD 1,487 previously.

According to Chris Beauchamp, a market analyst at IG Markets, Trump's announcement is not a complete ceasefire, so further developments are needed. He commented, "What has happened cannot yet be reversed, the impact is not yet clear, but it is obvious that the market is breathing a sigh of relief."

Trump's announcement of positive negotiations came as the Iran conflict entered its fifth week. Previously, he had threatened to attack Iran's power plants if the Strait of Hormuz was not reopened. Iran, in turn, stated it would retaliate against US infrastructure.

Last week, these tensions caused Brent crude prices to rise above USD 110 per barrel, while US WTI crude also neared USD 100. The Dow Jones and Nasdaq both fell about 2% last week, while the S&P 500 lost 1,5%, marking its first 4-week consecutive decline since 2023.

Phien An (according to CNBC, Reuters)