Oil prices and stock markets have fluctuated this week as investors parse the potential for a breakthrough between Washington and Tehran. The markets have whipsawed while assessing tentative signs of a pact to extend a ceasefire.
Reports indicate that the United States and Iran may have agreed in principle to extend their ceasefire, boosting hopes for a sustained de-escalation in the conflict and a deal to end the war. Such an agreement could potentially resume normal shipping through the Strait of Hormuz.
While oil prices fell and markets rallied on the news, analysts noted that traders are taking an optimistic view that disruption in the region could soon ease. However, some analysts warned that any potential ceasefire extension should be viewed cautiously.