Oil plunges 10% on Trump's Iran comments, and market pros warn the swings aren't over

• Oil prices plunged after President Donald Trump suggested the Iran war could be over soon.
• US stock futures dipped amid jittery trading on oil swings and geopolitical uncertainty.
• Asian markets are bouncing back after steep losses, but energy volatility remains high.

Oil prices plunged after President Donald Trump signaled that the Iran war may be nearing an end.

International benchmark Brent crude and US West Texas Intermediate futures tumbled as much as 11% late Monday before trimming losses.

By 3:40 am ET on Tuesday, Brent was down 8% at around $91.02 a barrel, while WTI also fell 8.3% to roughly $86.90 per barrel.

The sharp reversal came after a dramatic surge on Sunday night, when oil futures spiked to nearly $120 a barrel amid escalating fears of supply disruptions at the Strait of Hormuz — a critical chokepoint for global crude shipments.

"The market is now aware of President Trump's pain threshold on oil prices," wrote commodities strategists at ING in a Tuesday note.

Prices swung wildly on Monday before settling below $100 a barrel, as traders reacted to a stream of headlines out of Washington.

In an interview with CBS News, Trump said the war is "very complete, pretty much." However, he appeared to strike a different tone in remarks to House Republicans in Miami and during a press conference later that day, adding to market uncertainty.

US stock futures edged higher as investors weighed the mixed signals:

S&P 500 futures: 6,811.25, up 0.2%

Dow futures: 47,847.00, up 0.2%

Nasdaq futures: 25,037.50, up 0.2%

"Markets are beginning to trade the end of the conflict before it has actually happened," said Nigel Green, the CEO of deVere Group, a financial advisory firm.

Still, the outlook remains highly uncertain. Green said much will depend on the influence and decision-making approach of Iran's new Supreme Leader, Mojtaba Khamenei — another layer of unpredictability to the geopolitical backdrop.

ING's strategists echo the view that Trump's words can only go so far.

"Ultimately, the market will need to see a resumption of oil flows through the Strait of Hormuz to sustain a move lower in oil prices. Failing that, we are unlikely to have seen the highs yet," they wrote.

Asia markets rebound, with volatility likely to continue

Asian markets rebounded after steep losses on Monday, with investors focusing on signs that tensions may ease.

Japan's Nikkei 225 climbed 3.7%, while South Korea's Kospi jumped 6.6%.

Hong Kong's Hang Seng Index rose about 2%, and Taiwan's Taiex rose over 3%.

"The pressure valve has clearly been released for now. However, volatility across energy markets remains exceptionally elevated," wrote Chris Weston, the head of research at Pepperstone, pointing to heightened volatility levels in WTI crude.

Investors can expect significant intraday volatility to continue, including "moves that may not always make immediate sense," Weston added in his note.

"The geopolitical backdrop remains fluid, and traders should expect volatility to remain a defining feature of the trading environment in the days ahead," he wrote.