Oil Falls to $100 as Hormuz Supply Recovers, Boosting Global Equities
Brent crude stabilized near $100 following improved Strait of Hormuz transit data, driving a 1.5% rise in the S&P 500.
Key points
- Brent crude oil stabilized near USD100 after shipping volumes through the Strait of Hormuz reached a six-month high.
- The S&P 500 index rose 1.5% and the Nasdaq gained over 2% on lower energy costs and positive US-China trade talks.
- The New Zealand dollar remained flat at 0.5720 against the US dollar, while the Japanese yen weakened to 157.50.
Brent crude oil stabilized near USD100 after falling to a four-day low of USD99. This decline followed reports that shipping volumes through the Strait of Hormuz reached six-month highs.
Global equity markets responded positively to the lower energy costs and improved geopolitical outlook. The S&P 500 index rose 1.5%, while the Nasdaq advanced by more than 2% during the session.
Supply recovery drives energy price drop
US Central Command confirmed that oil and gas shipments over two weeks hit a six-month peak. Satellite data corroborated these figures by showing increased Saudi oil loadings during the same period.
Diplomatic efforts to de-escalate regional conflict also contributed to the market stability. President Trump indicated openness to meeting Iranian President Pezeshkian at the UN General Assembly.
US-China talks support risk appetite
Positive outcomes from talks between US Treasury Secretary Bessent and Chinese negotiators bolstered investor confidence. Both sides agreed to establish a dedicated dialogue framework for artificial intelligence development.
Trade negotiations continue regarding the extension of the current truce that expires in November. China seeks a longer extension, while the US proposes a shorter six-month timeline.
Currency movements remain modest overall
The New Zealand dollar remained flat around 0.5720 against the US dollar overnight. The Australian dollar held steady near 0.7120, keeping the cross rate unchanged at 0.8025.
The Japanese yen weakened slightly, with USD/JPY rising 0.4% to approximately 157.50. European bond yields fell between 6 and 9 basis points as lower oil prices reduced inflation concerns.
