Oil Prices Plummet 10% Following Trump Comments; Asian Markets Rally

Oil prices have slumped by 10% on Tuesday, 10 March, after US President Donald Trump declared the conflict with Iran “almost” over, triggering a significant rebound in Asian stock markets following Monday’s sharp declines.

The sharp reversal in crude prices follows a period of intense volatility, which saw the cost of a barrel surge over $90 in recent days due to supply disruptions from the Gulf.

On Monday, 9 March, prices experienced a historic spike of 30% within a few hours before moderating.

By 02:00 GMT on Tuesday, the West Texas Intermediate (WTI) benchmark had dropped 10.09% to $85.21, while the Brent crude benchmark fell 10.46% to $88.61.

This represents a cooling off from Monday’s session, where both benchmarks had topped $119, exceeding the $100 threshold for the first time since 2022.

Market Volatility and Strategic Shifts

The market shift was sparked by comments made by Donald Trump in an exchange with a CBS journalist late Monday.

Beyond his claim regarding the end of the conflict, the President stated he was considering taking control of the Strait of Hormuz—a vital chokepoint through which approximately 20% of the world’s oil and liquefied natural gas (LNG) transit.

Furthermore, Mr. Trump announced he would lift certain oil sanctions to help lower prices.

Art Hogan of B. Riley Wealth Management noted that these remarks have “completely changed the scene,” suggesting the administration is now weighing both the financial costs of the conflict and the impact on global markets.

This sentiment was reinforced by a G7 conference call on Monday.

While the group did not immediately decide to tap into strategic oil reserves, they expressed a readiness to do so, which analysts say has helped fuel hopes for a normalization in supply and logistics.

Asian Stock Markets Recover

Asian indices staged a strong recovery on Tuesday, aided by the cooling oil prices.

• Seoul: The Kospi index soared 6.49% after falling 6% on Monday.
• Tokyo: The Nikkei index rose 3.69% to 54,676 points, following a 5% drop the previous day.
• Other markets: Taipei gained 3%, Hong Kong’s Hang Seng rose 1.48%, and Sydney climbed 1.37%.

Despite the rally, analysts advise caution. “One must expect significant and persistent volatility throughout the session,” warned Chris Weston of broker Pepperstone.

“Even if the most acute tensions have eased, markets are still factoring in a significant degree of uncertainty and risk.”

Currency and Commodities

In other markets, the US dollar remained stable at 157.68 yen, supported by expectations that inflationary pressures from the oil spike may delay interest rate cuts by the Federal Reserve.

Meanwhile, gold rebounded 0.73% to $5,176 per ounce, recovering from a sharp fall on Monday as investors had previously sold the metal to cover margin calls on oil and equity losses.

Source: Defi Media