Oil prices have jumped as traders turned cautious over the prospect of a negotiated agreement between the United States and Iran to end the Middle East war, AFP reports.

Meanwhile, European and US stocks have held largely steady, having rallied on Monday after US President Donald Trump delayed strikes on Iranian energy sites and hailed “very good” talks with Iran.

Asian equities caught up with the strong gains, but the rally fizzled in the European and US sessions.

Oil prices, which had tumbled on Monday, rebounded strongly with Brent popping back above $100 a barrel.

“The Iran war is not over, and the Strait of Hormuz remains closed,” said Kathleen Brooks, research director at XTB. “It will take more conciliatory remarks from Donald Trump to extend Monday’s recovery rally and give hope that the war is close to wrapping up.”