A tentative agreement to end the Iran war and reopen the Strait of Hormuz sent Asian share prices soaring on Monday, while oil prices dropped sharply. The Nikkei stock index in Tokyo closed at a record high of 69,317.50, up 3,297.46 points from Friday, after briefly surging over 5 percent. Technology shares, particularly those related to artificial intelligence, led the gains, with the benchmark index having risen more than 80% over the past year [1]. The Kospi in Seoul surged 4.9% to 8,517.93, Hong Kong's Hang Seng gained 0.6% to 24,867.94, Shanghai Composite was up 1.1% to 4,073.08, Australia's S&P/ASX 200 advanced 1.4% to 8,922.90, and Taiwan's Taiex rose 2.5% [1].
Oil prices responded to the news with significant declines. Brent crude fell $3.61 to $83.64 per barrel, while U.S. benchmark crude dropped $4.27 to $80.61 per barrel [1]. The future for the S&P 500 was up 1% and that for the Dow Jones Industrial Average gained 0.9%, indicating likely early gains for Wall Street [1].
U.S. President Donald Trump confirmed the initial agreement and authorized an end to the U.S. naval blockade of Iranian ports. Iran also confirmed the deal but stated that implementation would not begin until a signing scheduled for Friday in Switzerland, according to Pakistan. Broader negotiations, including those concerning Iran’s nuclear program, are expected to continue over the next 60 days [1].
Analysts and energy experts cautioned that it may take months for oil prices to stabilize, as shipping and insurance companies will need assurance that the pact will hold and that oil and gas supplies will flow freely. Stephen Innes of SPI Asset Management noted, "The reopening of Hormuz is a relief valve, not a full peace dividend. The market can remove some crude panic, but it still has to price the gap between a headline, a signature, and a regime that actually complies" [1].
The deal offers relief to global markets and the economy, which have been unsettled since the conflict began in late February. The news was described as "great" by Takashi Hiroki, chief strategist at Monex, who attributed the market rally to foreign investor buying and expectations of easing tensions in the Middle East, supported by the decline in crude oil futures [1].
CONCLUSION
The tentative deal to end the Iran war and reopen the Strait of Hormuz has triggered a strong rally in global stock markets and a sharp drop in oil prices. While the news has provided immediate relief, analysts warn that full stabilization of oil markets will depend on the successful implementation of the agreement and continued compliance by all parties. Investors remain optimistic, but caution persists regarding the longer-term impact.