US stocks stabilized Tuesday after a drop in oil prices fueled by renewed optimism over peace negotiations. The Dow Jones Industrial Average and the S&P 500 both edged higher, while the Nasdaq Composite posted modest gains. The move came as crude oil futures fell more than 2%, retreating from recent highs.
Oil drops on peace hopes
Benchmark crude prices slid after reports that diplomatic efforts to end the conflict in Eastern Europe are gaining traction. Traders bet that a potential ceasefire could ease supply disruptions and bring more Russian oil back to global markets. The drop in oil helped calm inflation fears, giving equities a lift.
Brent crude, the international benchmark, fell to around $82 a barrel, while West Texas Intermediate settled near $78. The decline broke a three-day winning streak for oil, which had climbed on supply concerns.
Prediction markets see limited chance of new highs
Despite the pullback, prediction markets still see a small but real chance that oil could hit a new all-time high this year. The probability of crude reaching a record by September 30 stands at 7%. That figure rises to 14.5% for the end of December.
The odds reflect lingering uncertainty about the pace of peace talks and the potential for renewed supply shocks. Analysts caution that any breakdown in negotiations could quickly reverse the current price slide.
For now, investors are watching the next round of talks scheduled for later this week. A concrete agreement could push oil lower, while a stalemate would likely send prices back up.
