[MARKET ANALYSIS] Energy slumps as US-Iran secure a temporary ceasefire ahead of deadline

The US and Iran have agreed in principle to a two-week ceasefire, brokered with support from Pakistan, under which the US will suspend bombing and Iran will allow controlled reopening of the Strait of Hormuz. President Trump described the move as a “double-sided ceasefire,” saying most major disputes have already been resolved and that a broader peace agreement is close. Iran has accepted the pause, with its leadership approving negotiations set to begin in Islamabad, where both sides aim to finalise terms based on a 10-point proposal submitted by Tehran.
The ceasefire remains conditional and fragile. Iran stated it will halt military responses only if attacks stop, while warning it remains ready to retaliate if provoked. The arrangement includes limited safe passage through the Strait of Hormuz under Iranian coordination, a critical step given the severe disruption to global shipping and energy flows. Israel has signalled support for the temporary pause, though there is conflicting information over whether Lebanon is included.
Iran’s proposed framework reportedly includes demands such as sanctions relief, recognition of uranium enrichment, US military withdrawal from the region, and compensation for damages, claims the US disputes in tone and interpretation. Both sides are framing developments as victories domestically, while negotiations may last up to two weeks to convert recent military outcomes into a political settlement.
Energy prices plummeted. Crude futures both tumbled beneath the USD 100/bbl level following the announcement of a two-week US-Iran ceasefire within a couple of hours prior to President Trump's deadline. WTI May'26 (-15.5%) resides towards the bottom of a USD 91.70-96.27/bbl and Brent Jun'26 (-13.5%) towards the foot of a USD 91.05-109.19/bbl range. Dutch TTF (-15.5%) slipped to under EUR 45/MWh.
Spot gold rose above USD 4,850/oz before paring gains slightly to trade around the middle of a USD 4,713-4,858/oz range. Spot silver topped its 100 DMA (USD 76.11/oz) and resides near the top of a USD 73.38-77.65/oz parameter.
Copper climbed to a three-week high, and aluminium also advanced as easing concerns over global growth lifted sentiment. 3M LME copper trades towards the top end of a USD 12,550.00-12,743.90/t range.