Oil Prices Jump Over 4% After Trump Declares Iran Ceasefire Ended

U.S. crude oil surged more than 4% on Wednesday after President Donald Trump said the ceasefire with Iran was "over" and hinted at further military action. The benchmark rose to $76 a barrel, its biggest one-day gain since early June, and closed at $73.52, up 4.4% on the day. Brent crude also climbed, reaching $80 before settling at $78.02, a 5.2% increase.

The comments, made on the sidelines of the NATO summit in Ankara, were followed by statements that American forces might strike Iran again that night and could seize the Kharg Island oil export hub. Trump also suggested reinstating a naval blockade of Iranian vessels in the Strait of Hormuz.

U.S. stock indexes fell, with the S&P 500 down 0.3% and the Dow Jones Industrial Average dropping 577 points. The Russell 2000 slipped 0.9%, while the Nasdaq managed a modest gain as semiconductor stocks recovered. Airline shares led the losses, and companies dependent on discretionary spending, such as DoorDash and Home Depot, also declined.

The rally in oil prices halted a recent decline in U.S. gasoline prices, which had fallen from $4.56 per gallon in May to $3.79, according to AAA data. Heating oil and wholesale gas futures rose sharply as well.

Government bond yields rose, with the 10-year Treasury yield nearing 4.6%, its highest level since May. International markets also slipped, with major European indexes closing down more than 2%.

The market reaction follows U.S. accusations that Iran attacked three commercial vessels near the Strait of Hormuz and subsequent U.S. strikes and the revocation of a sanctions waiver that had allowed Iranian oil sales. Analysts noted that renewed Middle-East tensions have disrupted a previously calm market outlook and underscored the uncertainty surrounding any lasting U.S.-Iran agreement.