Oil rises as renewed US-Iran attacks cloud Hormuz shipping
Brent crude climbed after weekend strikes revived concern over the Strait of Hormuz, a key route for oil and liquefied natural gas.
By Daniel Okafor · Business Editor
3 min read
Oil prices rose Monday after another exchange of US and Iranian attacks raised fresh concern over shipping through the Strait of Hormuz, Al Jazeera reported. The waterway is a key energy route, carrying about one-fifth of global trade in oil and liquefied natural gas in peacetime, according to Al Jazeera.
Brent crude, the main international oil benchmark, gained about 0.9 percent on Monday, Al Jazeera reported. Brent futures for August delivery were at $73.21 a barrel at 03:30 GMT, 127 cents above their level the day before the United States and Israel began their war on Iran on February 28, according to the report.
Ceasefire hopes weaken
Fabien Yip, a market analyst at IG in Sydney, told Al Jazeera that Monday’s move suggested traders had become too optimistic about a ceasefire. He said oil had nearly given back the added risk premium from the war even though the June memorandum of understanding had no detailed enforcement mechanism and attacks had continued.
US Central Command said it carried out strikes against Iran on Friday and Saturday, citing Iranian attacks on two commercial vessels in the Strait of Hormuz, Al Jazeera reported. Iran responded with missiles and drones aimed at US military assets in Bahrain and Kuwait, according to Al Jazeera.
Multiple media outlets reported late Sunday, citing unnamed US officials, that Washington and Tehran had agreed to stop attacks and resume talks on ending the war. Axios, citing an unnamed senior US official, reported that the talks would take place Tuesday in Doha, Qatar.
Iran has not commented on the reported agreement to halt hostilities or on the planned talks, Al Jazeera reported. US President Donald Trump and Iranian President Masoud Pezeshkian signed a memorandum of understanding on June 17 to end the war, but Al Jazeera reported that the deal has come under repeated pressure from new fighting and disputes over the meaning of its terms.
Asian markets diverge
Asian stock markets were mixed Monday morning, according to Al Jazeera. Japan’s Nikkei 225 fell 0.7 percent and South Korea’s Kospi lost 1.9 percent, while Hong Kong’s Hang Seng Index rose 2.2 percent and Taiwan’s Taiex gained 1.4 percent.
Al Jazeera reported that shares tied to artificial intelligence spending were among the biggest decliners in Tokyo and Seoul. SoftBank Group fell about 5 percent, Advantest Corporation dropped 3.7 percent, Samsung Electronics declined about 5 percent and SK Hynix lost about 4 percent.
Yip told Al Jazeera that profit-taking near the end of the quarter was adding pressure after strong gains in regional markets. He said the Kospi was up roughly 95 percent this year and the Nikkei about 37 percent, while investors were weighing whether AI-related spending would keep feeding earnings growth or begin to squeeze margins sooner than expected.
This story draws on original reporting from Al Jazeera.