Oil prices plunged more than 6% on Monday after the United States halted its military operations against Iran that had lasted for nearly two weeks. This move erased the risk premium that had driven Brent crude above $100 just days earlier.
For 13 nights, tensions escalated with a series of strikes, pushing oil markets into a state of anxiety and causing prices to soar. Now, with Washington stepping back from direct military action and reopening diplomatic channels, traders quickly adjusted their outlook, sending the cost of crude sharply lower.
The sudden shift highlights how geopolitical concerns can heavily sway the energy markets, sometimes causing rapid swings in prices. Since oil prices act as a major input for global economies, this drop may ease some inflation pressures tied to fuel and transportation costs.
Markets had been on edge following the conflict escalation, but the return to diplomacy offers a sign of easing risks. The change also triggered wider market reactions, with US stock futures climbing as optimism grew along with the falling oil prices.
