Oil prices resumed their climb and global markets mostly declined Monday as the U.S. military prepared to blockade traffic to and from Iranian ports and the Strait of Hormuz, where most shipping has been stalled by Iran since the start of the war.
U.S. President Donald Trump announced the planned blockade after U.S.-Iran ceasefire talks in Pakistan ended without an agreement, and the U.S. military said the blockade involving all Iranian ports would begin Monday at 10 a.m. EDT, or 5:30 p.m. in Iran.
Oil prices have been rising as shipping through the strait has essentially stalled since late February. Brent crude oil, the international standard, has gone from roughly $70 per barrel before the war in late February to more than $119 at times.
On Monday, benchmark U.S. crude jumped $7.12 or 7.4% to $103.69 a barrel. Brent crude, the international standard, rose $7.04 or 7.4% to $102.24 a barrel.
France’s CAC 40 dropped 1.0% to 8.174.44 in early trading, while the German DAX lost 1.0% to 23.568.65. Britain’s FTSE 100 slipped 0.4% to 10.561.47. U.S. shares were set to drift lower with Dow futures down 0.5% at 47.911.00. S&P 500 futures fell 0.6% to 6.815.50.
In Asia, Japan’s benchmark Nikkei 225 lost 0.7% to finish at 56.502.77. Australia’s S&P/ASX 200 shed 0.4% to 8.926.00. South Korea’s Kospi dipped 0.9% to 5.808.62. Hong Kong’s Hang Seng slipped 0.9% to 25.660.85. while the Shanghai Composite was little changed, inching up less than 0.1% to 3.988.56.
Analysts said global trading was expected to remain turbulent for some time.
“The outcome of the talks was not really what people were hoping for, that’s for certain,” Neil Newman, Managing Director, Head of Strategy at Astris Advisory Japan, said in Hong Kong.
“As we stand here at the moment, it doesn’t look very nice. Certainly, the oil prices are a big concern.”
In currency trading, the U.S. dollar gained to 159.65 Japanese yen from 159.25 yen. The euro cost $1.1696. down from $1.1729.
