Global stock markets opened lower on Monday, while oil prices returned above $100 a barrel after talks between the United States and Iran collapsed, according to Reuters reports.
Global benchmark Brent crude rose above $101–102 per barrel, while US WTI reached $104–105 per barrel, marking an increase of over 7% intraday, following the return of geopolitical tensions.
The increase came after negotiations between the parties failed and Washington warned of new measures, including a naval blockade of Iranian exports, which could remove up to 2 million barrels a day from global supply.
In this climate of uncertainty, financial markets reacted negatively. US futures contracts fell by around 0.5%–0.9%, while stock markets in Asia and other markets recorded significant losses, reflecting the increase in risk.
Analysts warn that rising energy prices could have far-reaching consequences for the global economy. Oil above $100 a barrel increases inflationary pressures, risks pushing central banks toward tighter monetary policies and could slow economic growth in the coming months.
Also, tensions in the Gulf region and the risk of disruption in the Strait of Hormuz, through which about 20% of global oil supply passes, remain the main factors keeping markets under pressure.
Experts point out that, in the absence of a diplomatic solution, markets are expected to remain highly volatile, while oil prices could remain above $100 or rise further in the event of an escalation of the conflict, according to Reuters.
