Trump's Statements Cause Oil Price Rise, Stock Market Fall

Washington. Due to US President Donald Trump's latest statement, crude oil prices have increased in the international market while the stock market has declined. 

President Trump, speaking to Fox News on Sunday, stated that if a deal with Iran could not be reached, the US might bomb again and could 'take control' of the Strait of Hormuz, a sea lane crucial for global energy trade. The increase in oil prices was seen after his warning was made public. 

Following Trump's statement, Brent crude oil prices rose by 1.35 percent to $81.66 per barrel, while US crude oil prices also increased by 2.4 percent to $77.66 per barrel. 

Talks between the US and Iran in Switzerland regarding Hormuz, a ceasefire in Lebanon, and Iran's nuclear program were interrupted on Sunday. However, according to a US official, the talks were not fully concluded and would 'continue overnight.' 

Also read 

US-Iran talks stabilizing despite Trump's threats

In the event of a failed deal, Trump has also suggested that the US might consider charging fees for passage through the region. Currently, a memorandum of understanding between Washington and Tehran includes a commitment to resume waterway operations without charging fees for 60 days. 

Trump's warning came after Iran announced on Saturday that it would close the Strait of Hormuz, accusing the US of 'clear violation of its commitments.' According to Karen Young, a researcher at Columbia University, if the talks are successful and shipments through the waterway return to pre-war levels, the oil market could see a 'flood' of supply. 

According to AAA, the average price of gasoline in the US on Sunday was approximately $3.94 per gallon. While this price is about 14 percent lower than a month ago, it is still about $1 more expensive than before the war began. 

Meanwhile, the stock market has also been negatively affected by American political uncertainty and geopolitical tensions. Both Dow Futures and S&P 500 Futures have fallen by 0.4 percent, while Nasdaq Futures have decreased by 0.6 percent. 

CNN