Oil prices plummeted and Wall Street stocks surged on Wednesday after President Trump pointed to “great progress” in reaching a deal that would end the U.S. war with Iran.
The price of Brent crude oil, an international benchmark, dropped nearly 9% to $101 per barrel.
The Dow Jones Industrial Average surged over 600 points, or 1.2%, on hopes the conflict that began Feb. 28 could be reaching its end.
“It’s very possible that we’ll make a deal,” Mr. Trump said in the Oval Office.
All three major Wall Street indexes closed with large gains.
Markets were optimistic from the opening bell Wednesday, following Mr. Trump’s announcement late Tuesday that he would pause Project Freedom, an effort to free ships stuck in the Strait of Hormuz, upon the request of Pakistani mediators.
He said a blockade of Iranian ports would remain in place, although “Great Progress has been made toward a Complete and Final Agreement with Representatives of Iran.”
Mr. Trump says any deal must ensure that Tehran is unable to obtain a nuclear weapon. Efforts at reaching a deal, however, have faltered.
Pakistan’s mediators thanked Mr. Trump for his “courageous leadership and timely announcement.”
“We are very hopeful that the current momentum will lead to a lasting agreement that secures durable peace and stability for the region and beyond,” Pakistani Prime Minister Shehbaz Sharif said.
As negotiations ramp up, Iran faces economic pressure to end the war as it struggles to export oil under Mr. Trump’s blockade.
Mr. Trump faces pressure at home in the form of higher gas prices in a midterm election year.
The national average price of a gallon of gas reached $4.54 on Wednesday, up from $4.23 a week ago and around $3 per gallon at the start of the war.
