Israel-Iran Ceasefire: Markets Show Cautious Relief Despite Fragile Truce

Published At: June 25, 2025 by Rachel Tan

Conflict Status Update

A fragile U.S.-brokered ceasefire between Israel and Iran took effect on June 24, 2025, ending 12 days of intense military conflict that marked the most significant direct confrontation between the two nations. President Trump claimed credit for the truce, stating both sides "wanted to stop the war" after he helped "destroy all nuclear facilities and capability." The State Department confirmed the ceasefire but characterized it as "fragile" and "fluid," with immediate violations occurring as Iran launched ballistic missiles at Beersheba, killing four Israeli civilians.

The conflict's scope extended beyond bilateral exchanges, with Iran targeting the U.S. Al Udeid Air Base in Qatar with multiple missiles, though successful interceptions prevented American or Qatari casualties. The U.S. provided support to over 27,000 American citizens in the region and initiated assisted departure flights from Israel beginning June 21. Strategic military damage was extensive, with coordinated U.S.-Israeli strikes targeting Iranian nuclear facilities. While President Trump claimed complete destruction of Iran's nuclear capabilities, the State Department noted bomb damage assessments remain ongoing. Iran suffered critical leadership losses including senior IRGC commanders Mohammad Bagheri, Hossein Salami, and Amir Ali Hajizadeh, alongside 14+ nuclear scientists. The conflict's human toll reached 865+ Iranian fatalities (including 215 military personnel) and 28 Israeli deaths.

Energy Markets Analysis

Oil markets displayed volatile swings throughout the conflict before stabilizing post-ceasefire. Brent crude closed at $66.55 per barrel on June 24, declining 5.6% following the truce announcement, while WTI crude settled at $65.99 per barrel. The price correction reflected market relief that Iran refrained from its threatened closure of the Strait of Hormuz, through which 20% of global oil supply flows.

During peak tensions on June 23-24, tanker traffic temporarily diverted from the critical waterway as Iran fired ballistic missiles and threatened shipping lanes. However, normal transit patterns resumed quickly after the ceasefire took hold, preventing sustained supply disruptions. Regional energy infrastructure remained largely intact despite extensive military operations, with no major production facilities reporting significant damage.

The conflict's energy market impact was notably contained compared to previous Middle Eastern crises, partly due to strategic petroleum reserve releases and increased production flexibility from other suppliers. Natural gas markets showed minimal disruption, though regional distribution networks experienced temporary strain. Forward-looking supply risk assessments now center on ceasefire durability, with energy traders pricing in elevated volatility premiums. Iran's production capacity remains largely preserved, though international sanctions continue constraining export capabilities. Lower energy costs supported airline and industrial stocks while offsetting energy sector declines during the post-ceasefire period.

Financial Market Response

Safe-haven assets experienced predictable flows during the crisis before moderating post-ceasefire. Gold reached $3,344.42 per ounce by June 24 close, reflecting sustained demand for portfolio hedging despite the truce. The U.S. Dollar Index (DXY) traded at 97.8349 on June 25, down 0.12% monthly, as risk-off sentiment gradually subsided.