Trump halts US strikes on power plants after 'very good conversations' with Iran

US President Donald Trump has backed down from threats to bomb Iranian power plants following what he described on Monday as "very good and productive conversations" with Iran.

In a post on his Truth Social platform, Trump said he had ordered the Pentagon to halt strikes on Iranian energy infrastructure for a five-day period in light of the positive talks.

The price of oil and gas immediately fell and markets rallied following the US president's announcement.

Trump wrote that productive conversations between the US and Iran had taken place over the last two days "regarding a complete and total resolution of our hostilities in the Middle East".

He said that "based on the tenor and tone of these in depth, detailed and constructvive conversations", which would continue through the week, he had instructed the Pentagon to postpone "any and all military strikes against Iranian power plans and energy infrastructure for a five day period".

Trump wrote that this instruction was "subject to the success of the ongoing meetings and discussions". 

On Monday, the price of Brent Crude Oil dropped over eight percent on the news, while the price of natural gas dropped over three percent. 

Wall Street futures jumped two percent, while Europe's STOXX 600 and precious metals turned positive.

The Iranian embassy in Kabul said that Trump had backed down from attacking Iran's energy infrastructure after a firm warning from Tehran. Iran's Fars news agency said Trump retreated after hearing that Iran would target all power plants in West Asia.

Trump had warned on Saturday that Iranian power plants would be destroyed if Tehran failed to “fully open” the Strait of Hormuz to all shipping within 48 hours.