President Trump opted to delay a planned military campaign against Iran, citing the potential for a diplomatic resolution and concerns over munitions stockpiles. U.S. officials confirmed that military plans for strikes lasting up to two weeks were shelved on Friday, shifting the focus toward negotiations. Trump characterized this pivot as a move toward a smarter strategy, noting that communication with Tehran has resumed.

Market response was swift. Brent crude dropped 4.6% to $92.30 a barrel, while West Texas Intermediate fell 4.9% to $84.93. Maybank analysts noted that Brent has shed roughly 10% from its recent peak as the immediate risk of supply disruption eases. Commerzbank analysts highlighted that weekend discussions between Iranian and Omani officials regarding the Strait of Hormuz provided a necessary cooling effect on volatility. Across the Asia-Pacific, equity markets reacted to the de-escalation with a modest appetite for risk, as the Hang Seng Index gained 0.8% and Japan’s Nikkei added 0.2%.