US markets see biggest slump since start of US-Israel war on Iran

• Brent crude oil reached approximately $107 per barrel and US crude hit $93 per barrel, pushing average US gas prices to $3.98 per gallon
• The OECD estimates US inflation will average 4.2% in 2026, up from 2.6% in 2025, with G20 countries seeing inflation 1.2% higher on average due to elevated oil and fertilizer prices
• The White House extended a pause on Iranian energy infrastructure strikes by 10 days until April 6, as Trump claimed talks with Iran are 'going very well' despite earlier warnings to Iranian negotiators

Market Summary: US Markets Post Largest Decline Since Iran Conflict Began

Key Market Movements

US equities experienced their sharpest decline since the US-Israel war on Iran commenced. The Dow Jones closed down 450 points, the S&P 500 fell 1.7%, and the Nasdaq dropped 2.3%, entering correction territory (a decline of at least 10% from recent peaks).

Oil and Energy

Oil prices have surged to levels unseen since Russia's 2022 Ukraine invasion. Brent crude reached approximately $107 per barrel, while US crude hit $93 per barrel. Average US gasoline prices climbed to $3.98 per gallon, according to reported data.

Trump's Mixed Messaging

Market volatility was exacerbated by President Trump's contradictory statements. He noted oil prices "have not gone up as much as I thought" and predicted they would decline post-conflict. However, he also issued threats to Iranian negotiators before later claiming "very substantial talks" were underway. Iran reportedly allowed 10 oil tankers through the Strait of Hormuz as a diplomatic gesture.

The White House announced a 10-day extension of the pause on Iranian energy infrastructure strikes, extending until April 6.

Inflation Outlook

A new OECD report forecasts US inflation averaging 4.2% in 2026, up from 2.6% in 2025. G20 countries will see inflation 1.2% higher on average, driven by elevated oil prices and supply chain effects, including fertilizer imports from the region.

Market Implications

The conflict has reversed expectations for strong global economic growth, with the OECD warning it will "test the resilience of the global economy." Markets remain skittish amid geopolitical uncertainty and inflationary pressures.