The stock market tumbled and then recovered while oil prices skyrocketed following President Donald Trump’s widely anticipated Wednesday night speech on the Iran war that offered no new details.
All three of the market’s major indices initially plummeted following the speech, with the Dow Jones Industrial Average dropping 1.4% — more than 600 points. The Nasdaq Composite was at 2.2% and the S&P 500 was at 1.5%, CNBC reported Thursday. All three indexes recovered almost all of their losses later in the day when Iranian state media reported that the Islamic theocracy is working with Oman on a way to monitor the passage of ships through the Strait of Hormuz.
About 20% of the world’s oil demand usually flows through the narrow waterway, which separates the Middle Eastern countries of Iran and Oman. Iran effectively closed the strait’s traffic following the war’s outbreak on Feb. 28.
Following Trump’s speech on the war’s 33rd day, oil prices for both major global price benchmarks, Brent and West Texas Intermediate (WTI), surged. Brent crude futures settled 7.78% higher while WTI futures settled 11.41% higher, CNBC reported.
On Wednesday, the day of Trump’s speech, all three stock market indices rose — with the Dow rising by more than 220 points — and oil prices fell, with both Brent and WTI futures settling down, according to the outlet. This came as analysts speculated that the war might end soon.
“The market is kind of just sniffing out that there’s probably some type of resolution in the next couple of weeks,” Patrick Ryan, who runs Madison Investments’ multi-asset solutions team, told CNBC on Wednesday.
Addressing the nation Wednesday, Trump suggested that the war could end soon but said the U.S. will hit Iran “extremely hard over the next two to three weeks” and “bring them back to the stone ages, where they belong.” He added that “discussions are ongoing” with the Islamist nation.
“Our objectives are very simple and clear. We are systematically dismantling the regime’s ability to threaten America or project power outside of their borders,” Trump said. “That means eliminating Iran’s navy, which is now absolutely destroyed, hurting their air force and their missile program at levels never seen before.”
“Many Americans have been concerned to see the recent rise in gasoline prices here at home. This short-term increase has been entirely the result of the Iranian regime launching deranged terror attacks against commercial oil tankers and neighboring countries that have nothing to do with the conflict,” the president also said in his speech.
“This is yet more proof that Iran can never be trusted with nuclear weapons. They will use them, and they will use them quickly. It would lead to decades of extortion, economic pain, and instability worse than we can ever imagine,” he added.
Treasury Secretary Scott Bessent struck a similar tone when pressed about the rise in prices on NBC News’ “Meet The Press” March 22.
The secretary told host Kristen Welker that U.S. voters will soon understand that “50 days of temporary elevated prices” are a small sacrifice to guarantee “50 years of not having an Iranian regime with a nuclear weapon.”
(Featured Image Media Credit: Screen Capture/CSPAN)
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