Oil Prices Fall, Easing Global Stock Markets

Global markets fluctuated on Thursday due to a sudden reversal in oil prices.

After reaching their highest levels in Asia since 2022, driven by concerns over a prolonged conflict in the Middle East, crude oil prices sharply declined in European trading.

At 12:15 GMT, North Sea Brent crude fell 3.26%, to $114.18 per barrel.

It had earlier breached the $126 per barrel level, an unprecedented level since the shock caused by Russia's invasion of Ukraine in early 2022.

US WTI crude ceded 1.78%, to $104.98.

The initial surge was fueled by information from the US media outlet Axios, which reported that Donald Trump was to receive a briefing on new plans related to potential military action in Iran.

This prospect had revived concerns over global energy supply in a region already under high tension.

The movement then reversed without the geopolitical context easing.

Daniela Hathorn, analyst at Capital. com, notes that few factors have improved on the ground.

The Strait of Hormuz remains under pressure, as this strategic passage ensured around 20% of global oil and liquefied natural gas flows before the conflict.

The price drop is more due to profit-taking and partial easing of fear on the markets.

According to the analyst, investors seem to consider that the most extreme scenarios, such as a durable blockade of the Strait or the destruction of major infrastructure, are no longer gaining in probability.

At these price levels, a simple perception of less unfavorable news can be enough to trigger a marked decline.

Stephen Innes, manager of SPI AM, also observes a market less dominated by the most alarmist hypotheses.

Investors seem to prioritize a trajectory made up of limited disruptions and a gradual adjustment of supply.

This decline in oil prices has supported major European exchanges, sensitive to the evolution of energy costs.

At 12:15 GMT, Frankfurt rose 0.74%, London advanced 1.41%, and Milan gained 0.12%.

Paris remained slightly in the red, down 0.10%.

On Wall Street, futures contracts announced a positive opening.

US markets also remain buoyed by a new wave of corporate results, particularly in technology.

Alphabet exceeded expectations in the first quarter, as did Amazon.

Microsoft also reported an increase in revenue and net profit.

Before the opening, Alphabet soared 7.99%, Amazon gained 3.64%, while Microsoft fell 1.60%.

Meta published results above expectations, supported by the integration of artificial intelligence, but its title fell 9.43% in trading before the exchange.

Investors punished the increase in its investment forecasts, already deemed very high.

In Asia, markets had closed in decline, still under the influence of the oil price surge during the regional trading session.

Tokyo lost 1.06% and Seoul receded 1.38%, despite a new record briefly reached by the Kospi at the opening.

The continent's dependence on Gulf hydrocarbons continues to amplify investor nervousness.

Central banks remain in the spotlight.

The Bank of England maintained its key interest rate at 3.75%, while lowering its growth forecast for the British economy, amid uncertainties related to the Middle East conflict.

The European Central Bank also left its main rate unchanged at 2%.

The day before, the Federal Reserve had maintained its rates between 3.50 and 3.75 percent.