SINGAPORE — Oil prices tumbled and Asian equities surged Tuesday after President Donald Trump said the war involving Iran could end soon, easing a panic that had briefly driven crude toward $120 a barrel and rattled markets across the region. The reversal gathered pace as traders stripped out part of Monday’s geopolitical risk premium, even while threats to shipping and production around the Strait of Hormuz kept the market volatile through the Asian session, March 10, 2026.
Oil prices dive as Asia’s relief rally gathers pace
In early trade, Reuters reported Brent crude fell 6.6% to $92.45 a barrel and U.S. West Texas Intermediate dropped 6.5% to $88.65, a sharp pullback after both benchmarks touched roughly $119.50 during Monday’s spike. The move did not erase the broader shock, but it did show traders were willing to fade the worst-case scenario once talk of a near-term end to the conflict replaced some of the market’s most aggressive supply-loss assumptions.
That shift spilled across risk assets. A separate Reuters market wrap said MSCI’s Asia-Pacific index outside Japan rose 2.6%, while Japan’s Nikkei 225 jumped 3.6% and South Korea’s Kospi surged 6.4%, strong enough to trigger a brief sidecar trading curb in Seoul. The bounce suggested investors were treating oil’s reversal not as a final resolution, but as a reason to cover defensive bets that had built quickly during the selloff.
Trump’s language helped drive the turn. AP reported he described the campaign as a “short-term excursion” and warned Iran against disrupting the Strait of Hormuz, even as Iranian officials insisted Tehran would determine when the war ends. That mix of softer rhetoric and fresh threats explains why traders bought the relief but stopped short of declaring the energy scare finished.
What keeps oil prices exposed despite the drop
The market’s problem is that the physical risk has not vanished. AP outlined how the conflict is threatening export terminals, LNG facilities and the Hormuz chokepoint, the artery that carries roughly a fifth of the world’s oil and liquefied natural gas. Even if prices fall faster than they rose, refiners, shippers and importers still have to price the possibility of tanker delays, output cuts and infrastructure outages across the Gulf.
Governments are already responding as if the danger is real. Reuters detailed emergency steps ranging from South Korea’s planned domestic fuel cap to Japan’s preparations for a possible reserve release and Vietnam’s move to remove fuel import tariffs. Those measures underscore the gap between market sentiment, which can reverse in hours, and energy logistics, which usually take much longer to normalize.
Oil prices have snapped violently on Middle East shocks before
This week’s reversal fits a familiar pattern. When the United States killed Iranian commander Qassem Soleimani in January 2020, Reuters reported crude jumped on fears of a wider supply disruption. In April 2024, another Reuters report showed oil falling after Iran’s direct attack on Israel once traders concluded the immediate damage looked contained. And after the 2019 strike on Saudi facilities, Reuters detailed how the loss of more than half the kingdom’s output stunned global supply calculations. Each episode is different, but the throughline is the same: oil reprices fast when Gulf supply looks vulnerable, and it can unwind almost as fast when traders see an off-ramp.
For now, Tuesday’s relief rally looks less like a clean all-clear than a temporary repricing of the most extreme risk premium. If diplomacy gains traction, the drop in crude could stick and Asia’s rebound could broaden. If shipping disruptions worsen or attacks spread to more production sites, oil prices could just as easily reverse again.
