Equity markets experienced turbulence, and petroleum costs surged on Thursday as financial participants observed ongoing events in the Near East and processed President Donald Trump’s commitment to escalating hostilities with Iran.
The Dow experienced a decline of 61 points, representing 0.13%, recovering from an earlier plunge exceeding 650 points. The S&P 500 and Nasdaq registered gains of 0.11% and 0.18% respectively, recovering from prior slides of more than 1.5% each.
Equities had opened lower on Thursday but recouped losses after reports from Iranian state-affiliated media indicated that Tehran and Muscat are formulating a document intended to ease passage through the Strait of Hormuz. Traders remain keenly focused on the timeline for oil transit resumption via the strait.
Crude oil prices advanced, and market instability remained heightened subsequent to Trump’s televised address to the nation on the evening of April 1st, wherein he offered no clear disengagement plan nor a resolution for the de facto blockade of the strait, which has interrupted one-fifth of the world’s petroleum supply.
Investors are apprehensive that the conflict will continue to inflate worldwide energy expenses, resulting in greater inflation and sluggish economic expansion.
FILE – The Liberian-flagged tanker Shenlong Suezmax, laden with crude from Saudi Arabia, seen navigating past the Strait of Hormuz, is pictured at the Mumbai Port in Mumbai, India, on Thursday, March 12, 2026. (AP Photo/Rafiq Maqbool, file)
Crude Prices Spike Following Trump’s Threat to Strike Iran ‘Extremely Hard’
Trump stated the military action would persist for an additional two to three weeks minimum, even hinting at an intensification of the confrontation, suggesting the possibility of US action against Iran’s petroleum installations.
Trump’s statements triggered another abrupt rise in oil prices: Brent crude, the international oil benchmark, climbed by 7.8% Thursday, settling at $109.03 per barrel. WTI, the US benchmark, rocketed up by 11.41%, reaching $111.54 a barrel.
The futures contracts traded on Thursday for WTI pertained to May delivery, whereas the Brent contracts were set for June delivery. Speculators drove up the price of the nearer contract due to anticipation of near-term disruption in the strait, causing WTI to trade at a premium over Brent.
Stock markets in Asia and Europe registered declines. Japan’s Nikkei 225 dipped 2.38%, and South Korea’s Kospi dropped 4.47%. Germany’s DAX index edged down 0.78%, mitigating losses from an earlier 2.66% retreat.
US gasoline costs have now risen 37% since the commencement of the war, with the average price per gallon reaching $4.08 according to the most recent AAA figures. Citizens are feeling the strain of escalating prices, with some households confronting difficult choices owing to increased costs for everything from foodstuffs to air travel.
The surge in oil prices and the uncertainty surrounding the conflict’s duration are propagating through the economy via greater energy outlays. This is also disrupting the equity market: The Dow and S&P 500 just recorded their poorest quarterly results since September 2022. The Nasdaq experienced its worst monthly performance in a year last month.
Equities had rallied earlier this week, achieving their strongest single-day performance since May on Tuesday amidst growing optimism that the United States might endeavor to conclude the confrontation with Iran. However, Trump’s pronouncements on Wednesday offered little comfort to traders.
“Markets will only see a true and lasting recovery once global energy markets stabilize,” noted Kyle Rodda, a senior financial market analyst at Capital.com, in a memo.
In the debt market, yields decreased on Thursday after an initial rise. Yields remain elevated compared to the start of the conflict, leading to increased borrowing expenses throughout the economy. Investors have divested bonds, pushing yields higher, to account for prospective inflation and the possibility that the Federal Reserve will keep interest rates steady for an extended period.
Thursday marked the final US trading session of the week, as markets will be shuttered on Friday in observance of the Good Friday holiday.
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