ISLAMABAD: Global financial markets turned cautious on Tuesday as oil prices surged nearly 5 percent, pushing Brent Crude close to the $100-per-barrel mark amid escalating tensions involving Iran and uncertainty surrounding ceasefire negotiations.
Brent crude rose by $4.30 (4.5%) to reach $99.78 per barrel, while West Texas Intermediate jumped $4.75 (5.3%) to $94.36 per barrel—marking one of the sharpest single-day gains in recent weeks.
The spike in prices was driven by fears of supply disruptions following renewed military tensions and stalled diplomatic efforts.
Market sentiment weakened further after Donald Trump signaled he may not extend a ceasefire linked to the Iran conflict, warning that US forces are “ready to act” if negotiations fail.
Uncertainty over whether Iran would participate in last-minute peace talks also fueled concerns about a prolonged conflict.
In the United States, equities ended lower amid volatility. The S&P 500 posted a slight decline, while the Nasdaq Composite fell more sharply as rising oil prices stoked fears of inflation and slower economic growth. The Dow Jones Industrial Average remained relatively stable, supported by gains in energy and defense stocks.
A clear sector rotation was observed, with oil majors rallying strongly, while technology, consumer, and airline stocks came under pressure due to higher fuel costs and concerns over weakening demand.
European markets also edged lower, with the STOXX Europe 600 closing slightly down. Gains in energy and defense sectors were offset by losses in transport, industrial, and aviation stocks, dragging overall performance.
