Oil prices plunge, stocks surge as US-Iran deal to end conflict nears

The global energy and stock markets are once again experiencing a paradigm shift as officials have confirmed that the US and Iran are nearing a possible peace deal that will likely end the conflict.

In the wake of the report to end the months-long war in the Gulf, Brent crude futures, which is the global benchmark oil price, plummeted by $10.07 (9.2%) to $99.80 a barrel by 1042 GMT.

While US West Texas Intermediate (WTI) sank $10.79 (10.6%) to $91.48.

Both benchmarks are currently tracking toward their drastic single-day dollar losses in a month. This drop marks a two-week low for oil prices.

Talking about the global trading markets, the stocks have witnessed a surge as FTSE 100 index based in London jumped over 2 percent in early trading. Similarly, Germany-based DAX and French CAC 40 rallied 3 percent. The US-based S&P gained just under 1 percent.

The Asian markets also joined the global rally on Wednesday. South Korean Kospi showed positive performance with robust 6.45 percent gain at the close. Hong Kong’s Hang Sen and Japan’s Nikkei climbed 1.22 percent and 0.38 percent respectively.

The dramatic changes the markets are witnessing is only because of hope that Iran and US will soon make a peace deal to end this conflict, which has rattled global energy markets due to persistent closure of Strait of Hormuz.

As reported by Reuters, the United and Iran are edging closer to formal agreement on a one-page memorandum aiming to end the months-long war.

First, the report related to ending the conflict between the US and Iran was published by Axios. Later, the Pakistani source confirmed the authenticity of these claims.

"We will close this very soon. We are getting close," the Pakistani source said.