By John Meyer, consultant in financial affairs – Eurasia Business News, June 25, 2025. Article no. 1584

The announcement of a ceasefire between Israel and Iran led to a strong rally in stock markets and a sharp decline in oil prices, reflecting eased geopolitical risks and diminished fears of supply disruptions.

Stocks Rise

U.S. equities surged, with the Dow Jones Industrial Average rising over 1.2% (about 507 points), the S&P 500 climbing 1.1%, and the Nasdaq 100 hitting record highs, powered by gains in tech stocks. This rally was fueled by investor optimism that the fragile ceasefire would hold and prevent further escalation of conflict that had unsettled markets for nearly two weeks.

The easing of tensions reduced downside risks to global growth, encouraging investors to move back into riskier assets and boosting market sentiment.

Oil Prices Fall

Oil prices plunged nearly 4% on the day of the ceasefire announcement, adding to a previous 9% drop after Iran’s symbolic strike on a U.S. military base. U.S. crude futures fell to around $66.24 per barrel, the lowest since early June, as fears of supply interruptions through the Strait of Hormuz faded.

The market perceived the ceasefire as reducing the risk of a surge in oil prices, which alleviated inflation concerns and supported global economic growth prospects.

On June 22, oil prices surged by approximately 11% amid escalating conflict between Iran and Israel, driven by fears of supply disruptions and broader geopolitical risks in the Middle East.

Read also : Gold : Build Your Wealth and Freedom

The ceasefire between Israel and Iran calmed markets by lowering geopolitical risk, leading to higher stock prices driven by renewed investor confidence and lower oil prices due to diminished fears of supply disruption.

President Trump brought the Middle East’s “12-Day War” to an end with a hammer blow to the Iranian nuclear program and then diplomatic pressure. 

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© Copyright 2025 – Eurasia Business News. Article no. 1584.