Crude falls and stocks gain as Trump says war is nearing end

• Military offensive ‘ahead’ of goals
• No attacks in Hormuz for 48 hours
• Crude settles at around $90

Energy and financial markets eased on Monday night into Tuesday morning after US president Donald Trump signaled that the Israeli-US war against Iran could be nearing the end of at least its initial, high-intensity military offensive.

Crude prices settled at around $90 a barrel when US markets closed at 20:00 GMT after surging to nearly $120 in the previous 24 hours following escalating attacks on the Islamic Republic and its retaliation across Gulf states. 

By early trading Tuesday, Brent crude fetched $92.45, a 6.6 percent drop, while West Texas Intermediate crude was priced at $88.65, down 6.12 percent at 00:18 GMT.

The S&P, Nasdaq and Dow indices were up 0.83 percent, 1.38 percent and 0.5 percent at close, respectively.

Shortly before that, Trump told CBS News in a phone interview that “the war is very complete, pretty much”. 

He said the military offensive is “very far” ahead of what was initially expected to be a 4 to 5 week schedule, and that it has left Iran with “no navy, no communications, they’ve got no air force”. 

The president repeated similar sentiments in the evening during remarks to Republican lawmakers in Florida, calling the war a “short-term excursion” that will “be finished pretty quickly”.

But, he added: “We’ve already won in many ways, but we haven’t won enough.” He said he is “more determined than ever to achieve ultimate victory”.

Iranian strikes against the UAE in particular fell to a new low on Monday since the beginning of the conflict on February 28, although the Islamic Republic continued to target Saudi Arabia, Bahrain, Kuwait and other countries in the region.

The Joint Maritime Information Centre said in its latest advisory there had been “no confirmed attacks against commercial vessels” in the Strait during the previous 48 hours, though it maintained the risk level at “critical”. 

On the ground, the conflict continued to affect energy facilities and flows.

Saudi Arabia became the latest country, after Iraq, Kuwait and Qatar, to curtail domestic production because Iranian attacks are making it exceedingly hard for tankers to load supplies and ship out of the Strait of Hormuz, according to the Wall Street Journal. 

The kingdom “preemptively” suspended operations at offshore fields like Safaniya and Zuluf and lowered output in others, while it works to reroute more crude via its East-West pipeline, which bypasses Hormuz to end on the Red Sea coast, the Journal said.

G7 energy ministers agreed to meet virtually on Tuesday to discuss releasing oil reserves. 

French president Emmanuel Macron said earlier on Monday that “the situation remains extremely volatile” and the conflict could last “several days, perhaps several weeks” as reported by the Wall Street Journal.

Markets that ended trading before Trump’s comments continued sliding on Monday. The FTSE 100 was down 0.34 percent, Dubai dropped 2.8 percent, Abu Dhabi 0.4 percent and Saudi Arabia closed down 1.3 percent.