US stocks climbed on Friday while crude oil prices fell sharply after President Donald Trump signaled that a decision on a potential agreement with Iran could be imminent.
In a post on Truth Social, Trump said he was heading into the Situation Room to make a “final determination” regarding a framework aimed at ending the conflict and addressing several longstanding security and energy concerns.
Among his stated conditions, Trump said Iran must permanently forgo any nuclear weapons capability and ensure that the Strait of Hormuz remains open to unrestricted shipping traffic.
He also said the US naval blockade imposed during the conflict would be lifted and outlined a plan under which enriched nuclear material buried at Iranian sites would be recovered and destroyed in coordination with Iran and the International Atomic Energy Agency.
Trump added that no money would be exchanged under the arrangement and indicated that other provisions had already been agreed upon.
Investors appeared encouraged by the prospect of a diplomatic breakthrough.
The S&P 500 and Nasdaq Composite each gained roughly 0.3%, while the Dow Jones Industrial Average rose 353 points, or 0.7%.
All three major indexes touched fresh all-time intraday highs as traders positioned for a potentially less disruptive geopolitical environment.
Technology shares continued to provide leadership, helping drive the broader market higher as investors looked beyond recent conflict-related volatility.
Crude oil prices extended their decline as hopes for a resolution reduced fears of a prolonged supply shock.
US West Texas Intermediate crude futures fell roughly 2% to around $86 per barrel, while Brent crude declined a similar amount to approximately $91 per barrel.
The pullback came despite reports that Iranian armed forces launched missiles late Thursday, suggesting traders are placing greater weight on the possibility of a negotiated settlement than on isolated military developments.
Oil markets have been highly sensitive to developments surrounding the Strait of Hormuz, one of the world’s most important energy shipping routes.
Any agreement guaranteeing unrestricted passage through the waterway would significantly reduce concerns about global supply disruptions and could further ease pressure on energy prices.
Markets are now waiting for clarity on whether the preliminary framework can evolve into a formal agreement.
For investors, the key implications extend beyond geopolitics.
Lower oil prices could help ease inflationary pressures, improve the outlook for consumers and businesses, and support expectations that economic growth can remain resilient without a renewed energy shock.
As a result, the outcome of Trump’s discussions with Iran is increasingly being viewed not only as a geopolitical event, but also as a potentially important catalyst for global markets, inflation expectations, and energy prices.
