Global stock markets swung wildly and oil prices fell on Monday after Donald Trump postponed US attacks on Iranian power plants for five days.
European stock markets, which had been falling sharply in the hours before Trump’s social media post, mostly rose on Monday as relieved investors digested the update.
The French Cac 40, the Spanish Ibex and the German Dax, which all also opened lower, were up by 0.8%, 1% and 1.2% respectively. The FTSE 100 share index, which had fallen by almost 1.5% in early trading, reversed course to gain 0.4%, before paring back again to close down 0.2%. US markets were up more than 1% in early afternoon trading on Wall Street.
Oil prices, which had been rising after Trump threatened over the weekend to strike Iranian infrastructure unless Iran opened the strait of Hormuz, dropped sharply. Brent crude, the international benchmark, fell 10% to $101 a barrel. The UK month-ahead gas prices fell 6% to 142p a therm.
The US president said on his social media platform Truth Social that the US and Iran had “very good and productive conversations” over the past two days regarding “a complete and total resolution of our hostilities in the Middle East”.
He said: “Based on the tenor and tone of these in-depth, detailed, and constructive conversations, which will continue throughout the week, I have instructed the Department of War to postpone any and all military strikes against Iranian power plants and energy infrastructure for a five-day period, subject to the success of the ongoing meetings and discussions.”
The US dollar, which investors typically flock to during volatile periods, slipped 0.4% against a basket of other leading currencies.
Trump’s U-turn comes after he said on Saturday that he was giving Iran 48 hours – until shortly before midnight GMT on Monday – to open the strait of Hormuz, which carries about a fifth of global oil and liquefied natural gas supplies.
Tehran said it would “irreversibly destroy” essential infrastructure across the Middle East, including vital water systems, if the US followed through on Trump’s threat.
Iranian attacks have in effect closed the strait, triggering a global energy crisis that the head of the International Energy Agency, Fatih Birol, has said is equivalent to the combined force of the twin oil shock of the 1970s and the fallout of Russia’s invasion of Ukraine.
The global economy has braced for much higher oil prices owing to disruption in the strait, with Goldman Sachs forecasting Brent crude, the international benchmark, will average $85 a barrel this year, up from previous expectations of $77 a barrel. Brent hit $119.50 a barrel earlier this month, the highest since the war began.
Oil price chart
Shares in the oil companies BP and Shell fell more than 3% on Monday after Trump’s post.
Elevated energy prices have spooked investors, with the price of gold also sliding on Monday. Its spot price fell 2.5% to $4,388 an ounce as the prospect of higher inflation still fed expectations of interest rate rises. Gold becomes relatively less appealing when interest rates are elevated, as the metal does not pay a yield.
Keir Starmer was to hold an emergency Cobra meeting with his top ministers and the Bank of England governor, Andrew Bailey, on Monday to discuss the economic impact of the crisis in Iran. They were also due to discuss energy security, supply chain resilience and the international response to the war, the Treasury said.
The conflict in Iran is ramping up pressure on Starmer to announce a support package to help people with their energy bills, which are expected to rise by 20% when an existing price cap covering gas and electricity expires at the end of June.
Some of the pressure came off the UK’s bond market. The 10-year-yield, which is the benchmark for Britain’s borrowing costs, fell three basis points to 4.95, after hitting 5% last week for the first time since the 2008 financial crisis.
This article was amended on 23 March 2026. The high this month was $119 a barrel, not $199 a barrel as an earlier version said.
