Oil prices took a nosedive on Wednesday while global stock markets surged amid optimism that the United States and Iran are edging closer to an agreement allowing for the transportation of crude oil from the Persian Gulf to resume smoothly.
The price of a barrel of Brent crude, the global benchmark, plummeted by 7.8% to slightly above $100 US per barrel, a significant drop from over $115 US earlier in the week. This decline followed U.S. President Donald Trump’s social media announcement hinting at the potential reopening of the Strait of Hormuz “OPEN TO ALL” if Iran agrees to an undisclosed reported deal.
The Strait of Hormuz, a crucial passage for oil tankers in the Persian Gulf, has been a major point of contention due to the conflict with Iran, disrupting the flow of oil and contributing to global economic turmoil. Reopening the strait could alleviate inflationary pressures and facilitate the smooth movement of oil, positively impacting prices of various commodities worldwide.
In the financial markets, the S&P 500 surged by 1.5%, achieving its best performance in nearly a month and reaching a new all-time high. The Dow Jones Industrial Average soared by 612 points, or 1.2%, and the Nasdaq composite hit a record high with a 2% increase.
By the close of trading, Canada’s S&P/TSX composite index was up approximately 1.2% at 33,981.82 points. Similarly, international stock markets experienced substantial gains, with Seoul rising by 6.5%, Paris by 2.9%, and London by 2.1%.
Although hopes have been raised multiple times on Wall Street regarding a potential resolution to the conflict with Iran, uncertainties remain. Despite a temporary drop below $100 US, the price of Brent crude rebounded above that mark after Trump’s veiled threat of heightened military action if Iran rejects the reported agreement.
Amid these developments, prominent U.S. corporations have reported stronger-than-expected profits for the beginning of 2026, boosting market confidence despite the ongoing geopolitical tensions. Companies like AMD and Super Micro Computer saw significant stock surges following positive earnings reports, while the bond market experienced a notable shift as falling oil prices alleviated inflation concerns.