NEW YORK (AP) — Oil prices plunged and U.S. stock futures jumped after President Donald Trump said he would hold off on his threat of devastating attacks on Iran for two weeks if the Iranians agree to allow ships to pass through the Strait of Hormuz. Futures for U.S. crude oil sank 18% to around $92.60 while Brent crude oil futures fell about 6% to $103.40. Both prices remain well above where they were at the start of the war. Futures for the S&P
500 rose 2.4%. Trump said Iran has proposed a “workable” 10-point peace plan that could help end war the U.S. and Israel launched on Feb. 28.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
NEW YORK (AP) — U.S. stocks swung sharply Tuesday as uncertainty about the war with Iran increased ahead of a looming deadline set by President Donald Trump to destroy Iranian power plants and bridges.
The S&P 500 fell as much as 1.2% after Trump threatened that a “whole civilization will die tonight, never to be brought back again” if Iran does not meet his deadline at 8 p.m. Eastern time to open the Strait of Hormuz. But stocks rallied at the end of trading after Pakistan’s prime minister urged Trump to extend his deadline for another two weeks and asked Iran to open up the strait for two weeks.
The S&P 500 erased all its losses and ended with a modest gain of 0.1%. The Dow Jones Industrial Average dipped 85 points, or 0.2%, and the Nasdaq composite added 0.1%.
They’re the latest swings to hit financial markets since late February because of deep uncertainty about when the fighting may end. During just the first hour of Tuesday’s trading, the Dow careened between a gain of 74 points and a loss of 425.
Oil prices were likewise shaky. The price for a barrel of benchmark U.S. crude to be delivered in May briefly climbed above $117 before settling at $112.95, up 0.5%.
The price for a barrel of Brent crude, the international standard, eased by 0.5% to $109.27. It’s still well above its roughly $70 level from before the war began in late February.
Oil prices have spiked because the war has snarled the production and transportation of crude in the Persian Gulf. Much of that oil exits the gulf through the Strait of Hormuz to reach customers around the world, but Iran has blocked it to enemies.
The worry in markets has been that a long-term disruption will keep oil prices high for a long time and send a painful wave of inflation crashing through the global economy.
So far in the war, Trump has made a series of threats to blow up Iranian power plants if it doesn’t open the Strait of Hormuz, only to delay it several times. The possibility remains that Trump could hold off on his threats again, among other scenarios.
A year ago, Trump ultimately backed off many of the stiff tariffs that he initially threatened to put on imports from other countries, though they ended up higher than from before his second term.
“Investors are likely to remain on edge and markets unable to establish trends, probably until there is a clear outcome later this evening: a deal, the U.S./Israeli strikes intensify, or Iran’s retaliation becomes escalatory instead of proportional,” according to Paul Christopher, head of global investment strategy at Wells Fargo Investment Institute.
On Wall Street, companies with big fuel bills fell sharply as high oil prices cranked up the pressure.
Norwegian Cruise Line Holdings dropped 3.3%, and United Airlines sank 1.8%.
Companies whose customers may have the least room to absorb the recent jump in gasoline prices also struggled. Dollar Tree slid 4.2%, and Dollar General fell 2.6%.
The average price for a gallon of regular gasoline across the United States has leaped to $4.14, according to AAA. It was below $3 a couple days before the United States and Israel launched attacks to begin the war in late February.
Stocks of health insurers helped support the market after the Centers for Medicare & Medicaid Services said Medicare Advantage payments will likely see a net average increase of 2.48% in 2027. That was well ahead of what some investors expected, according to UBS analysts led by AJ Rice.
UnitedHealth Group jumped 9.4%, and Humana rose 7.9%.
Broadcom was another force pushing strongly upward on the market. It rose 6.2% after announcing deals with Google and Anthropic.
All told, the S&P 500 rose 5.02 points to 6,616.85. The Dow Jones Industrial Average dipped 85.42 points to 46,584.46, and the Nasdaq composite added 21.51 to 22,017.85.
In stock markets abroad, Universal Music Group jumped 11.4% in Amsterdam after Bill Ackman’s Pershing Square Capital Management offered to buy the record label behind Taylor Swift and Bad Bunny in a cash-and-stock deal valued at approximately $64 billion.
Pershing Square argued the proposed deal would clear uncertainty that’s weighed on UMG’s stock, but its share price remained below what Pershing said its bid is worth. That could indicate investor doubt that the deal will happen.
In stock markets abroad, indexes fell across much of Europe. Asian stock indexes were stronger, with South Korea’s Kospi up 0.8% for one of the world’s bigger gains.
In the bond market, Treasury yields eased modestly. The yield on the 10-year Treasury fell to 4.30% from 4.34% late Monday.
That’s still well above its 3.97% level from before the war, and the rise has pushed up rates for mortgages and other loans going to U.S. households and businesses, which slows the economy.
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AP Business Writers Yuri Kageyama and Matt Ott contributed.
