Oil Surges and Stocks Retreat After Donald Trump Signals Prolonged Iran Conflict

Oil prices climbed sharply while global stock markets declined after U.S. President Donald Trump delivered a primetime address from the White House on Wednesday, outlining a more aggressive stance in the ongoing Iran conflict.

In his speech, Trump warned that the United States would strike Iran “extremely hard” within the next two to three weeks. He also urged countries dependent on Middle Eastern oil to take responsibility for maintaining access through the Strait of Hormuz, emphasizing that the U.S. itself does not rely on energy supplies from the region.

The Strait of Hormuz remains a critical artery for global energy flows, with roughly 20% of the world’s oil typically passing through the narrow route. However, it has effectively been shut down since hostilities escalated, as Iran responded to U.S. and Israeli strikes by threatening vessels operating in the area.

Before Trump’s address, benchmark Brent crude hovered around $100 (£75.50) per barrel. Following his remarks, prices surged by 6.5% to $107.70. Meanwhile, West Texas Intermediate crude rose 5.5% to approximately $105.70.

Alberto Bellorin of InterCapital Energy described the jump as a “clear market reality check following the earlier optimism for an imminent ceasefire.” He added that Trump’s speech lacked a “concrete timeline” for reopening the Strait of Hormuz, warning that a return to normal conditions now appears “months away rather than weeks.”

Bellorin further noted that by calling on other nations to intervene, Trump has effectively dashed expectations of a quick resolution to disruptions in global energy supply.

Tina Soliman-Hunter from Macquarie University echoed this sentiment, stating that Trump’s remarks indicate the conflict is likely to persist, leading investors to anticipate prolonged constraints on oil supply.

Equity markets across Asia reacted negatively to the developments, reversing earlier gains.

Japan’s Nikkei 225 dropped more than 2%, South Korea’s Kospi fell by 4.5%, and Hong Kong’s Hang Seng index declined by 1.4%. Regional markets have remained volatile since the Iran conflict began in late February, with Asia particularly exposed due to its heavy reliance on Middle Eastern energy imports.

In the United States, stock futures also pointed to a weaker start on Wall Street. Futures for the Dow Jones Industrial Average and the S&P 500 each slipped around 1%, while Nasdaq futures declined by roughly 1.4%.

Stock market futures, which allow investors to buy or sell an index at a predetermined price for a future date, are widely viewed as indicators of market expectations. Their movement reflects investor sentiment about the likely direction of the market in response to unfolding geopolitical events.

By fLEXI tEAM