Oil prices fall around 2pc as markets await US-Iran peace talks

Global oil prices edged lower on Thursday while stock markets moved in mixed directions as investors waited for updates on a US-led initiative aimed at ending the Middle East conflict and reopening the Strait of Hormuz.

The decline followed a volatile session a day earlier, when crude futures had plunged by more than 10 per cent on optimism over possible peace negotiations. On Thursday, losses were more moderate, with oil prices down by around two per cent.

In equity markets, European shares slipped after strong gains in the previous trading session, while several Asian markets advanced. Tokyo’s benchmark index surged 5.6 per cent, largely due to the resumption of trading after public holidays.

Market analysts said investor sentiment had cooled after an initial wave of optimism. One strategist noted that while hopes for de-escalation remain, challenges persist in reaching a lasting agreement despite reports that Iran is reviewing a US peace proposal.

US President Donald Trump indicated that a deal could be close following constructive discussions, while Iranian officials said they would convey their position through mediator Pakistan. The conflict, which began in late February, has disrupted regional stability, with Iran responding through attacks and restricting movement through the Strait of Hormuz.

In currency markets, the US dollar weakened slightly as its safe-haven appeal eased. Meanwhile, the Japanese yen remained under scrutiny amid speculation of possible government intervention to support the currency.

Separately, Norway’s central bank raised its key interest rate by 25 basis points to 4.25 per cent, citing inflation risks linked in part to global tensions.

In corporate developments, technology stocks continued to attract strong investment on the back of artificial intelligence-driven earnings momentum from major firms including Apple, Alphabet, Microsoft and Samsung.

Emirates Group also reported a three per cent rise in annual profit to $5.7 billion, despite disruptions to flight operations caused by the ongoing conflict.