Oil prices fell down on Friday after President Donald Trump delayed giving a deadline for Iran to reopen the Strait of Hormuz, while equities also slipped as investors approached Washington’s mixed signals with great caution, feeling extremely uncertain over its unpredictable nature.
Trump had earlier warned that Iranian energy infrastructure could be targeted if the vital shipping corridor was not reopened within a span of 48 hours, though has since extended his deadline multiple times – with the most recent delay being April 6, claiming that talks were progressing constructively.
“Talks are ongoing… they are going very well,” he said, adding the pause on potential strikes would be extended by 10 days at Tehran’s request.
However, this has been rebutted by Iranian officials, as state media reported that Tehran had responded via intermediaries, laying down several conditions to end its blockade of the waterway, including an end to US-Israeli attacks, reparations of $500bn, and recognition of Iran’s control over Hormuz.
Trump also claimed Iran had allowed a limited number of tankers to pass, a claim which has been refuted by Iran, which confirmed that as of now it has only allowed access to the strait to friendly nations, such as India, China, Russia, Iraq, and Pakistan.
Brent crude also fell by more than 1% on the day but still remains nearly 50% above pre-war levels, while the US benchmark crude is up about 40% since the war started on February 28.
Asian equities declined across Tokyo, Seoul, Hong Kong and Sydney, further showcasing the growing uncertainty over the war’s trajectory, with economists warning that the delay offered limited reassurance.
“Time has been purchased, not clarity,” said Stephen Innes of SPI Asset Management.
Likewise, the World Trade Organisation warned of severe trade disruptions, while the OECD (Organisation for Economic Cooperation and Development) said the US inflation could exceed 4% (vs 2.8% previously).
Spain approved a €5.4bn ($5.8bn) support package, while Poland and South Korea introduced subsidies and tax relief.
Central banks are also turning cautious, while US federal hinted that rate cuts may be delayed as energy-driven inflation intensifies.
