Global crude oil prices declined more than 1 per cent on Thursday after Israel and Lebanon agreed to implement a ceasefire, raising hopes of a broader diplomatic breakthrough that could ease tensions surrounding the ongoing Iran conflict.

International oil benchmark Brent crude fell 1.33 per cent to $96.50 per barrel. Similarly, US West Texas Intermediate (WTI) crude declined over 1 per cent to $94.76 per barrel.

The decline in oil prices came after both benchmarks had gained nearly 2 per cent in the previous session amid renewed hostilities in West Asia, including Iranian attacks on Kuwait and US military strikes near the strategic Strait of Hormuz.

In the US, the Republican-controlled House of Representatives approved a resolution seeking to limit President Donald Trump’s authority to continue military operations against Iran.

Trump said progress in negotiations with Iran could emerge as early as this weekend.

Iranian Foreign Minister Abbas Araqchi said contacts with Washington had not been severed, although he added that negotiations had yet to produce meaningful progress, with both sides continuing to review exchanged proposals.

However, Gulf tensions escalated further as Iranian drones targeted Kuwait International Airport following a fresh exchange of strikes between the United States and Iran, injuring several people and damaging airport infrastructure.

The Kuwaiti military said the attack caused significant material damage, forcing authorities to suspend air traffic operations

Weak sentiment persisted across global equities, with major Asian indices including Japan’s Nikkei, Hong Kong’s Hang Seng, South Korea’s KOSPI and Indonesia’s Jakarta Composite declining by as much as 3 per cent.

US markets also closed lower overnight, with the S&P 500 falling 0.74 per cent and the Nasdaq ending 0.9 per cent lower.

In addition, domestic equity benchmarks Sensex and Nifty opened lower on Thursday, with falling around 0.5 per cent amid selling pressure in IT, realty, pharma and healthcare stocks.