The US and Iran agree to a two-week ceasefire. Gold rises over 3%, while crude oil plunges 19%, falling below the $100 mark.

Zhitong Finance APP learned that U.S. President Trump said he has agreed to a two-week ceasefire. Driven by this news, gold prices rose.

On social media, Trump wrote that he has agreed to pause the bombing of Iran. And less than two hours earlier, he set the final deadline for “destroying the entire civilization” of Iran.

Iran also agreed to temporarily reopen the Strait of Hormuz for two weeks. Oil prices plunged, the U.S. dollar weakened, and that supported gold prices.

Oil prices plunged to below $100 per barrel.

Gold spot prices once rose by more than 3%, breaking through the important $4,850 per-ounce level, extending the 1.2% increase from the previous trading day.

As of the time of publication, spot gold was up 2.76%, to $4,835.84 per ounce. Silver rose 2.6%, to $74.90 per ounce. Platinum and palladium prices also saw increases. The U.S. spot dollar index fell 0.3%. WTI crude oil prices once slumped by as much as 19%, posting the largest single-day drop since 2020, approaching around $91 per barrel; Brent crude was around $109 per barrel on Tuesday.

In a post on the X website, Iranian Foreign Minister Abbas Araghchi said that, by coordinating with Iran’s armed forces and “fully considering technical limitations,” it is possible for safety to be ensured in the Strait of Hormuz. Trump previously said that the ceasefire agreement would take effect depending on whether Iran reopens the waterway, and it would help “finalize and complete” the relevant agreement. Reports said Israel has agreed to pause bombing Iran during the negotiations. According to another report, the first round of talks between the U.S. and Iran will be held in Islamabad on Friday.

Earlier, before the final deadline set by Trump for Tuesday 8:00 p.m. Eastern Time (Wednesday 8:00 a.m. Beijing time), military actions escalated continuously, and the U.S. president’s threats toward Iran grew increasingly pressing, including a post claiming, “Tonight, a civilization will go to ruin.” Earlier that day, U.S. officials said U.S. forces struck multiple targets on Iran’s Khark Island. The targets were similar to those hit last month, but were not aimed at energy infrastructure. Then the two sides subsequently agreed to a two-week ceasefire.

Even so, “the entity systems will not restore anytime soon,” said Robert Rennie, head of global commodities research at Westpac. “Restarting shut-in oil wells, redeploying personnel and vessels, and rebuilding refinery inventory all take months.”

The conflict in the Middle East has lasted six weeks, driving energy prices sharply higher. After the war broke out, the Strait of Hormuz was nearly shut, causing about one-fifth of global oil and liquefied natural gas shipments to be disrupted, making energy markets unsettled. Since the conflict erupted in late February, WTI crude prices have still risen by about 40%. According to estimates by the U.S. government, the transport disruption is expected to result in more than 9 million barrels per day of oil production being shut down in April for the Middle East’s major oil-producing countries.

Against this backdrop, inflation risks have intensified, and major central banks are more likely to delay rate cuts and even raise rates. Bond traders expect the Federal Reserve to keep borrowing costs unchanged for the rest of this year, which is a negative for non-yielding gold. Since the conflict erupted in late February, gold prices have fallen nearly 10%. Some investors need to liquidate positions to make up for losses in other areas, which has also weakened gold’s appeal as a traditional safe-haven asset.