Markets turned cautious on Friday after planned US-Iran talks in Switzerland were cancelled, raising fresh questions about the path toward a lasting peace agreement in the Middle East.
The talks were expected to move forward after the two countries announced a preliminary framework earlier this week. However, US Vice President JD Vance withdrew from the meeting, delaying negotiations and creating uncertainty over the next steps.
Despite the setback, oil prices remained on track for a sharp weekly decline, as traders continued to price in expectations that the Strait of Hormuz will eventually remain open and regional energy supplies will normalize. Brent and WTI crude were both heading for weekly losses of around 8%, although prices recovered slightly during Friday’s session as geopolitical risks resurfaced.
Investors are now watching whether diplomatic efforts can resume in the coming days. A lasting agreement could help stabilize energy markets and ease inflation concerns, while further delays may keep volatility elevated.
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