Oil, markets react to US-Iran ceasefire MOU

U.S. and Iranian negotiators have reached a 60-day memorandum of understanding to extend the ceasefire and begin talks on Iran’s nuclear program, according to sources cited by MS NOW. The reported agreement marks a tentative step toward formal negotiations while maintaining a pause in hostilities.

The memorandum of understanding still requires approval from President Donald Trump, the same sources said. That condition has left markets weighing the prospect of an extended truce against the risk that the deal may not be finalized.

Reports of the memorandum altered how traders priced geopolitical risk in energy and broader asset markets. Initial reactions to military developments were partly reversed as investors reassessed the likelihood of a wider disruption to oil supplies from the Gulf region.

Oil prices experienced significant intraday volatility on May 28 as headlines moved rapidly from military escalation to potential de-escalation. Early in the session, prices rallied following reports of strikes and missile activity involving U.S. and Iranian forces.

By 11:23 a.m. ET, Brent crude futures (UKOIL) were trading around $95 per barrel, up roughly 0.75% on the day. Over the same period, U.S. West Texas Intermediate futures (USOIL) had risen about $1.29 to $89.97 per barrel.

Those levels represented a pullback from earlier highs after the ceasefire-extension report emerged. The news that negotiators had agreed a 60-day framework to extend the ceasefire and start nuclear talks led oil to pare gains, as some of the earlier risk premium linked to supply disruption eased.

CNBC reported that the Islamic Revolutionary Guard Corps said it targeted a U.S. air base at about 4:50 a.m. local time. U.S. Central Command said Iran launched ballistic missiles toward Kuwait that were intercepted, according to the same coverage.

These reported actions followed American strikes in Iran earlier the same day. The sequence of attacks initially pushed investors toward risk-off positioning, with concerns centered on the potential for escalation in a key oil-producing region.

The subsequent report of a memorandum on a ceasefire extension and nuclear talks moderated some of those fears. Markets responded by partially reversing earlier moves, with oil prices and other assets adjusting to the reduced near-term probability of major supply disruptions, while remaining sensitive to the pending requirement for presidential approval.

Headlines from major outlets highlighted that the reported U.S.-Iran deal and its need for President Trump’s final approval became a central driver for financial markets. Coverage noted that markets rallied on hopes of a ceasefire extension, with oil prices trimming earlier gains as geopolitical risk was repriced.

Other assets, including U.S. stocks, currencies, emerging-market equities, and gold, were also reported as reacting to shifting expectations around the U.S.-Iran negotiations. Moves across these markets reflected a mixed sentiment, with investors balancing signs of diplomatic progress against lingering uncertainty over the deal’s approval and durability.

Overall, the May 28 developments underscored how quickly geopolitical headlines around the U.S.-Iran relationship can transmit into commodity prices and global financial markets, especially when they directly affect expectations for Gulf oil flows and regional stability.