Oil Prices Dip as Trump Eases Iran Tensions; Stocks on the Rise

On Thursday, global oil prices hit a significant low as US President Donald Trump toned down his rhetoric regarding Iran, reducing worries of potential disruptions to oil supply. Concurrently, US stock markets experienced a bounce back following two days of decline.

Brent North Sea crude and West Texas Intermediate saw declines exceeding four percent after Trump remarked on Wednesday that he would “watch it and see” about any possible US intervention in Iran. He also noted receiving information that the violent suppression of protesters had ceased.

Previously, crude prices had been buoyed by Trump's comments advocating for the Iranian populace amid a governmental crackdown on protests, heightening fears of supply disruptions. However, his recent comments diminished geopolitical risks within the oil market.

“With tensions easing between Iran and the US, the political risk premium is swiftly being eliminated from oil prices,” commented Kathleen Brooks, research director at XTB.

Investor confidence picked up in equity markets following robust earnings reports. Taiwanese chip manufacturer TSMC reported fourth-quarter profits that exceeded expectations, boosting technology stock prices. The Nasdaq saw an increase of over one percent early in the trading day, primarily due to gains in leading semiconductor firms.

However, some profit-taking was noted later in the day among major technology and chip stocks, as pointed out by Briefing.com analyst Patrick O’Hare.

Once-suffering US equities saw gains after US Commerce Secretary Howard Lutnick warned that semiconductor companies not producing within the United States might face tariffs up to 100 percent.

Despite early fluctuations, all three central US indices concluded the day on a positive note. The S&P 500 climbed by 0.3 percent, with stocks of Morgan Stanley and Goldman Sachs rising sharply by 5.8 percent and 4.6 percent respectively, driven by strong profits linked to increased mergers and acquisitions.

In Europe, London's FTSE 100 achieved a new record high following indicators of economic recovery in the UK during November. Frankfurt's market responded positively as reports suggested that Germany narrowly evaded a third consecutive year of recession, displaying minor economic growth into 2025. Paris stocks saw slight declines due to a drop in TotalEnergies shares as a result of falling oil prices.

Asian markets showed mixed results, with Tokyo ending 0.4 percent lower after recent gains, stirred by speculation that Prime Minister Sanae Takaichi might call for early elections amidst strong approval ratings.

In commodity trading, silver prices fell by 0.3 percent after a substantial earlier drop of more than seven percent. Gold prices also modestly declined, retreating from their recent peaks.