Brent crude prices retreated in the session as the United States paused an almost two-week run of military strikes against Iran.
The halt in hostilities, combined with Tehran’s signal that it is refraining from retaliatory attacks, has significantly reduced the immediate risk of a supply disruption in the Middle East.
The de-escalation marks a sharp pivot from the heightened tensions that had previously weighed on global energy markets.
The cross-asset reaction was immediate.
Oil prices dropped as traders unwound the geopolitical risk premium that had been embedded in energy valuations.
Conversely, equity markets responded positively to the reduced uncertainty.