Geopolitical tensions in the Middle East continued to shape global financial trading on Tuesday, as Asian equity markets traded mixed and crude oil pulled back from recent elevated levels after former U.S. President Donald Trump announced he would delay a planned military strike on Iran to allow for diplomatic negotiations. The pullback in oil prices came amid glimmers of hope for de-escalation, but ongoing uncertainty over the Strait of Hormuz kept energy markets volatile and investor risk appetite in check.
The regional conflict that began in late February between the U.S.-Israel bloc and opposing forces has resulted in a de facto blockade of the Strait of Hormuz, the critical chokepoint that carries roughly 20 percent of the world’s global oil exports during peacetime. In a post to his Truth Social platform Tuesday, Trump revealed that the leaders of Qatar, Saudi Arabia, and the United Arab Emirates had requested he hold off the scheduled military strike to open space for negotiations. He wrote that he had granted the request, as “serious negotiations are now taking place.”
Despite pausing offensive action, Trump stressed that U.S. military forces remain on high alert, ready to launch a full-scale large-scale assault on Iran at a moment’s notice if negotiations fail to reach an acceptable outcome. Speaking at a subsequent White House event, he framed the current diplomatic push as a “very positive development,” noting that key Arab regional allies believe a final deal is within reach that would see Iran abandon its nuclear program — a goal Tehran has long denied pursuing.
“There seems to be a very good chance that they can work something out. If we can do that without bombing the hell out of them, I’d be very happy,” Trump told reporters, while reiterating his warning that military action remains on the table if talks collapse. This dual messaging underscored the continued fragility of security in one of the world’s most energy-rich regions.
The prospect of a diplomatic breakthrough sent oil prices lower, though the decline provided only limited relief after weeks of extreme volatility driven by the ongoing Middle East conflict. At the time of reporting, global benchmark Brent crude hovered around $109 per barrel, while U.S. West Texas Intermediate traded near $107. Official data as of 0230 GMT recorded Brent down 2.1 percent at $109.75 per barrel, while WTI bucked the broader trend to gain 1.2 percent, hitting $107.40 a barrel.
Across Asian equity markets, performance was uneven as investors balanced cautious optimism over diplomacy with lingering anxiety over geopolitical and economic risks. Japan’s Nikkei 225 opened and closed 0.5 percent lower at 60,537.87, as broader geopolitical jitters offset a better-than-expected first-quarter GDP report that showed the Japanese economy expanding 0.5 percent, exceeding analyst forecasts of 0.4 percent growth. South Korea’s Kospi index fell more than four percent, dragged down by steep losses in the technology sector that tracked downward movement on Wall Street a day earlier. Markets in Shanghai, Taipei, and Jakarta also closed lower, while the Hang Seng Index in Hong Kong gained 0.3 percent to hit 25,740.60, and benchmarks in Sydney and Wellington also finished in positive territory.
Safe-haven assets edged higher on Tuesday, with gold and silver posting small gains, a signal that investor caution remains elevated despite the diplomatic opening. All market eyes are now turning to Wednesday, when U.S. semiconductor giant Nvidia is set to release its quarterly earnings results. The report is widely anticipated as investors seek clarity on whether massive current investments in artificial intelligence data center infrastructure will deliver the strong returns market participants have priced in.
Other global market moves were muted. The Dow Jones Industrial Average closed up 0.3 percent at 49,686.12 in New York’s previous session, while London’s FTSE 100 gained 1.3 percent to close at 10,323.75. Currency markets saw minor shifts: the pound dipped to $1.3416 from $1.3422 on Monday, the euro edged up against sterling to 86.80 pence, fell slightly against the dollar to $1.1645, and the dollar gained marginally against the yen to reach 158.98 yen.