Oil prices climbed and stocks fell on Thursday on fears over the nascent US-Iran ceasefire after Tehran threatened to resume hostilities after Israel launched a major bombardment of Lebanon.
Equity markets across the globe soared and crude plunged on Wednesday after President Donald Trump announced the two-week halt in the war. But with the deal less than a day old, cracks were already appearing.
The Lebanon Issue
Tel Aviv said the ceasefire did not include Israel’s fight against Iran-backed Hezbollah in Lebanon as it continued attacks on its northern neighbour.
Vice President JD Vance said: “If Iran wants to let this negotiation fall apart… over Lebanon, which has nothing to do with them, and which the United States never once said was part of the ceasefire, that’s ultimately their choice.”
Iran’s Response
Iran said the terms of the deal were broken. The country’s parliament speaker, Mohammad Bagher Ghalibaf , posted on X that the “workable basis on which to negotiate” had already been violated, making further talks “unreasonable.”
He listed three alleged US violations:
-
Continued attacks in Lebanon
-
A drone entering Iranian airspace
-
A denial of the country’s right to enrichment
Hezbollah said it had fired rockets towards Israel in response to its “violation.”
Meanwhile, a senior US official said Tehran’s 10-point plan was not the same set of conditions the White House had agreed to.
Oil Prices
Fears that the ceasefire could fall apart while crude remains stuck in the Strait of Hormuz saw:
-
West Texas Intermediate: Jumped around 3% (after plunging 16% the day before)
-
Brent: Up more than 2% , trading at around $97 a barrel
Stocks Slide
Equities gave up some of their gains. Tokyo, Hong Kong, Shanghai, Sydney, Singapore, Seoul, and Taipei were all down.
The Islamabad Talks
Attention is turning to crunch talks in Pakistan expected on Friday or Saturday, with Vance leading the US delegation.
Skye Masters of National Australia Bank noted: “Many questions remain with the 10-point plan that Trump has received from Iran (which includes Iranian control of the Strait of Hormuz, US acceptance of Iran’s uranium enrichment programme, the end of all sanctions and withdrawal of the US military from the Gulf region) is at odds with Trump’s 15-point peace plan.”
The Stuck Ships
Shipping journal Lloyd’s List estimated that around 800 ships have been stuck in the Gulf since the end of February, when hostilities broke out.
The Bottom Line
The ceasefire is less than a day old, and cracks are already showing.
Lebanon is still burning. Hormuz is still closed. Iran is threatening. Oil is up. Stocks are down.
The Islamabad talks are coming. But the deal is fragileand the world is watching.
