Oil prices rebounded on Thursday as concerns intensified over the stability of the ceasefire between the United States and Iran, following renewed hostilities in the region.

The development comes after Israel reportedly carried out heavy bombardments in Lebanon, prompting Hezbollah to retaliate with rocket attacks targeting northern Israel over alleged ceasefire violations.

Rising geopolitical tensions pushed crude prices higher, with West Texas Intermediate (WTI) gaining nearly 3 per cent after plunging more than 16 per cent the previous day. Brent crude also recorded an increase of over 2 per cent, recovering from a sharp 13 per cent decline.

The renewed uncertainty has also weighed on global equities, with markets across Asia showing signs of decline. Early trading saw slight losses in major financial hubs including Tokyo, Hong Kong, Shanghai, Sydney, Singapore, Seoul, and Taipei, reversing earlier gains.

Market sentiment remains cautious as investors monitor the situation closely, particularly developments surrounding the Strait of Hormuz—a critical route for global oil supply.

Despite claims from the White House that maritime activity had increased following the ceasefire announcement, independent data suggests otherwise. Windward, a maritime intelligence firm, reported that only 11 vessels passed through the strait on Wednesday, a figure consistent with previous days and indicating no significant change in traffic.

The fragile state of the ceasefire continues to fuel volatility in global energy markets, with traders wary that any escalation could disrupt oil supply routes and trigger further price spikes.