Crude oil prices dropped sharply after the United States and Iran announced a framework agreement to end the war, with Brent crude oil prices falling 4.7% to $83.24 per barrel.
US President Donald Trump said the agreement would help reopen the important Strait of Hormuz shipping route, which has been largely closed since the US and Israel launched airstrikes on Iran on February 28.
The Strait of Hormuz has been a major concern for global energy supplies, as around 20% of the world's oil and liquefied natural gas (LNG) normally passes through it, according to the BBC.
Investors welcomed the peace framework, causing major gains in Asian stock markets, with Japan's Nikkei 225 index jumping 5% and South Korea's Kospi index rising 5.2%.
European markets also gained after the deal news, with Germany's DAX rising about 1.7% and France's CAC 40 increasing around 1.7%.
However, analysts caution that the market may still face supply-related challenges even after the peace agreement, with futures contracts suggesting oil may not fall below $70 per barrel until late 2031.
