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Oil prices plunge after US pauses attacks on Iran
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Key Points:
- Oil prices dropped sharply by 9% on Monday, falling below $90 a barrel to about $88, after the U.S. paused attacks on Iran and avoided escalating the conflict over the weekend.
- The Dow Jones Industrial Average rose 262 points (0.5%), while the S&P 500 was nearly flat and the Nasdaq declined slightly by 0.1%.
- President Trump opted for diplomacy to reopen the Strait of Hormuz instead of escalating military action, partly due to concerns over depleting U.S. air defense interceptors.
- The Strait of Hormuz, a critical shipping route for about 20% of global oil supply, saw reduced traffic amid the conflict, causing oil prices to previously surge above $100 a barrel.
- Despite the temporary pause, Iran denies direct negotiations with the U.S., stating talks are limited to arrangements with Oman regarding the Strait of Hormuz, leaving diplomatic prospects uncertain.
