Global crude oil prices fell by more than 1% on Thursday following a ceasefire agreement between Israel and Lebanon. This development raised hopes for a broader diplomatic resolution that could potentially ease tensions related to the ongoing Iran conflict. The international oil benchmark Brent crude decreased by 1.33% to $96.50 per barrel, while US West Texas Intermediate (WTI) crude also saw a decline of over 1% to $94.76 per barrel.
The decline in oil prices occurred after both benchmarks had recorded nearly a 2% increase in the previous session amidst renewed hostilities in West Asia. This included Iranian attacks on Kuwait and US military actions near the strategic Strait of Hormuz.
In the US, the Republican-controlled House of Representatives passed a resolution aimed at limiting President Donald Trump’s authority to continue military operations against Iran. Trump mentioned the possibility of progress in negotiations with Iran as early as the upcoming weekend.
Iranian Foreign Minister Abbas Araqchi stated that communication with Washington had not been cut off, although he noted that the negotiations had not yielded significant progress yet. Both sides are still evaluating the proposals put forward.
Despite these developments, tensions in the Gulf region escalated further as Iranian drones targeted Kuwait International Airport after a fresh round of strikes between the US and Iran. This incident resulted in injuries to several individuals and damage to airport infrastructure, as confirmed by the Kuwaiti military.
Weak market sentiment persisted globally, with major Asian indices such as Japan’s Nikkei, Hong Kong’s Hang Seng, South Korea’s KOSPI, and Indonesia’s Jakarta Composite declining by up to 3%. In the US, markets closed lower, with the S&P 500 dropping by 0.74% and the Nasdaq finishing 0.9% lower. Domestically, India’s equity benchmarks Sensex and Nifty opened lower on Thursday, with declines of around 0.5%, driven by selling pressure in IT, realty, pharma, and healthcare stocks.
