Oil prices rebounded sharply Thursday, surpassing $97 a barrel as global investors grew skeptical of a fragile two-week US-Iran ceasefire.
Brent crude climbed 2.4% to $97.02, and US benchmark crude rose 3.3% to $97.50. Both contracts had briefly dipped below $92 following the initial ceasefire announcement.
This recovery signals deepening doubts about the ceasefire's durability. Iran has kept the critical Strait of Hormuz largely closed, a key pressure point and a clear indicator that the situation remains volatile. The waterway normally handles about a fifth of the world's oil supply.
Adding to market anxiety, Israeli strikes in Lebanon resulted in hundreds of casualties, further questioning whether the regional conflict is genuinely cooling.
Asian markets mirrored this pessimism. Tokyo's Nikkei 225 fell 0.9%, South Korea's Kospi dropped 1.6%, Hong Kong's Hang Seng slipped 0.4%, and Shanghai's Composite declined 0.7%. This contrasts sharply with Wednesday's Wall Street rally, where the S&P 500 jumped 2.5% and the Dow Jones Industrial Average rose 2.9% on initial ceasefire optimism.
Peace talks aimed at a permanent resolution are anticipated to begin as soon as Friday in Pakistan, with US Vice President JD Vance expected to lead the American delegation. However, the survival of the ceasefire until then, with the Strait of Hormuz closed and continued Israeli strikes, remains uncertain.
Gold and silver prices fell as some safe-haven demand unwound, though this optimism is now appearing increasingly fragile. The dollar saw a slight increase against the yen, while the euro also edged higher.