Oil Slides Toward Eight-Week Low as Iran Deal Hopes Lift Stocks and Bonds

Crude oil prices fell on Friday as traders weighed the prospect that the United States and Iran could end the conflict that has disrupted Middle Eastern energy supplies for two months. The Financial Times reported that oil reached a three-month low while stocks and government bonds posted large gains, as investors judged that the energy shock could ease.

The move followed President Donald Trump's statement that a peace agreement could be signed within days. Brent crude dropped more than 4 percent toward an eight-week low, and West Texas Intermediate had already fallen 2.58 percent on Thursday to settle near 87.71 dollars a barrel. The decline extends a retreat of roughly 20 percent from the 2026 peak that the war produced.

The reaction in equities was broad. The Dow Jones Industrial Average rose 929.97 points, or 1.86 percent, on Thursday to close at 50,848.75, the S&P 500 added 1.75 percent, and the technology-heavy Nasdaq Composite advanced 2.54 percent. The Tel Aviv exchange opened higher on Friday on the same news, Globes reported, with dual-listed shares gaining.

Caution remains. Africanews noted that the Strait of Hormuz stayed open to shipping despite Iran's earlier announcement of a blockade, and analysts warn that even a signed accord would face delays before crude supplies return to normal, including clearing mines, restarting idled fields, and repairing damaged facilities.

From a sound-money perspective, the episode is a reminder that much of the inflation of recent months reflected a real supply shock added on top of years of monetary expansion. A falling oil price relieves the headline pressure, but it does not unwind the credit already created, and the underlying price level does not return to where it began.