At the same time technology stocks came under pressure while investors shifted their focus toward corporate earnings and the outlook for interest rates.
Efforts to bring an end to the ongoing Middle East conflict showed little progress with negotiations appearing to be at a standstill. The United States is currently reviewing Tehran’s latest proposal to reopen the vital shipping route while Iran has made it clear that Washington can no longer dictate terms.
Iran has blocked the waterway a crucial route for global oil and gas shipments since the start of the US-Israeli offensive two months ago triggering major disruptions across international markets and adding pressure on the global economy.
Reports indicate that US President Donald Trump is unlikely to accept Iran’s proposal to restore traffic through the strait. Meanwhile, Qatar has warned that without a clear resolution, the situation could evolve into a prolonged “frozen conflict.”
Oil markets reacted strongly to the uncertainty. Brent crude for June delivery rose by 2.7 percent to $111.19 per barrel, while US benchmark West Texas Intermediate (WTI) climbed 3.4 percent to $99.68 per barrel.
Optimism for a potential agreement had been building over the weekend, but those expectations were dampened after Trump cancelled a planned diplomatic visit by his envoys Steve Witkoff and Jared Kushner to Islamabad, slowing down momentum in negotiations.
Kathleen Brooks research director at XTB, said markets are currently not optimistic about the chances of a deal highlighting that Iran’s demand to delay discussions on nuclear disarmament has become a major obstacle further complicating efforts to reopen the Strait of Hormuz and stabilise global oil supplies.
