Stocks hit records and oil steadies as U.S. and Iran weigh ceasefire extension

Global stocks rose and oil prices held steady this week as investors grew more optimistic that the U.S. and Iran could reach a lasting peace deal before their ceasefire expires. Since hostilities began on Feb. 28, the S&P 500 has now climbed 2%, notching a record high in the process.

Crude markets showed little movement, with Brent crude trading at $95 a barrel and its American counterpart, West Texas Intermediate, edging up toward $92. Prices have found a degree of equilibrium even as shipping disruptions in the Strait of Hormuz continue.

In a prerecorded interview that aired on Fox Business Network this week, Trump declared the war "very close to over," saying Tehran was hungry for a resolution. "We'll see what happens, I think they want to make a deal very badly," he said. He added that an end to the fighting would send oil prices lower and cause the stock market to "boom."

Citing regional officials, the Associated Press reported that Washington and Tehran had reached an "in principle agreement" on extending their ceasefire to make room for further negotiations, as noted by CNBC. A senior U.S. official pushed back on that characterization, telling CNBC the ceasefire extension had not been formally approved, though "continued engagement" between the two countries was ongoing. Meanwhile, Trump indicated to the New York Post that a new round of talks in Islamabad might begin within days.

Late this week, U.S. Central Command announced that its naval blockade was fully in place, barring vessels from entering or leaving Iranian ports and severing the country's access to international maritime commerce. The Strait of Hormuz, which threads between Iran and Oman and in peacetime channels roughly a fifth of global oil supplies, remains at the center of the disruption.

Equity markets abroad joined the rally. In Asia, strong gains in Tokyo and Seoul led the way, with the Nikkei 225 up nearly 3% and the Kospi adding more than 2%. Europe's Stoxx 600 also advanced, putting the index within reach of erasing the bulk of its war-era decline.

At the pump, prices have remained elevated since the war began, surging quickly but retreating slowly — what energy analysts call "rockets and feathers." AAA put the national average at $4.09 a gallon, a pullback from the recent peak that nonetheless leaves drivers paying 37% more than they did before the fighting started. Diesel edged down to $5.61 a gallon but is still running about half again as high as its pre-conflict price.

The energy shock has rippled through the broader economy. The consumer price index climbed 0.9% in March, pushing annual inflation to 3.3%, with gasoline prices posting their steepest monthly rise since the series began in 1967.