Crude prices dipped on March 20 after Israeli Prime Minister Benjamin Netanyahu said Iran was being "decimated" and that the war would end earlier than many feared.
Traders also welcomed U.S. President Donald Trump's remarks that Israeli forces would not target any more of Tehran's energy infrastructure, after strikes on a key gas field on March 18 sparked warnings of retaliation against installations across the Gulf.
But with the conflict heading into a fourth week, equities mostly fell as investors fret over energy markets, with oil still holding around $100 and gas surging amid the effective closure of the crucial Strait of Hormuz.
Netanyahu told a news conference on March 19 that Israel and the United States were "winning and Iran is being decimated,” adding that the Islamic republic no longer had the capacity to enrich uranium or manufacture ballistic missiles.
"This war is ending a lot faster than people think," he said without providing a specific timeframe.
Netanyahu also said he would help the United States try to secure Hormuz, through which a fifth of global oil and gas flows.
His comments came after Washington said there was no deadline to end the war launched against Iran on February 28.
Meanwhile, French President Emmanuel Macron said his country planned to talk with permanent members of the U.N. Security Council about establishing a U.N. framework, once the ongoing exchange of fire had ended, to secure navigation in the Strait of Hormuz.
In a sign the conflict was unlikely to end soon, Israel launched a wave of strikes on Tehran on March 20, as Gulf nations faced fresh attacks, while Iran continued to target neighbors with an oil refinery in Kuwait set alight after a drone attack.
While Wall Street enjoyed a late rally on the remarks, Asian stock markets slipped as nervous traders awaited positive developments in the crisis.
Hong Kong, Shanghai, Sydney, Singapore, Taipei and Wellington all fell, though Seoul, Mumbai and Bangkok rose. Tokyo was closed for a holiday.
