Oil prices rose on Monday after US President Donald Trump increased pressure on Iran, warning Tehran that it had little time left to break the impasse with Washington.
“For Iran, the clock is ticking, and they better act fast, or there will be nothing left of them. Time is of the essence!” Trump said on Truth Social.
Brent crude futures for July delivery rose 1.98% to $111.42 per barrel. US WTI futures for June rose 2.43% to $107.98 per barrel, the strongest level for WTI this month.
Trump is pressuring Iran more forcefully, as the Hormuz crisis raises concerns among oil traders
Trump’s latest reckless actions warning This came at a time when talks between Washington and Tehran remained pending regarding the peace agreement and the reopening of the Strait of Hormuz.
A fragile ceasefire was agreed in April, but so far Iran has kept the Hormuz Waterway mostly closed, while the Trump administration has continued to close Iranian ports.
The pressure is showing in stocks as well. Brent crude is now up 74% since the start of the year, although it is still below the late April high of $118 a barrel, and the International Energy Agency said last week that global oil inventories are falling at the fastest pace on record as the market tries to cover the loss of Middle East supplies.
The International Energy Agency said stocks could approach critical levels if Hormuz remains closed. It also warned that fuel and oil prices may rise further before peak demand in the summer. The agency said in its monthly report: “The rapid shrinkage in reserves amid the ongoing turmoil may portend higher prices in the future.”
This is no small warning. Summer demand is coming, media supply is dwindling, and the Middle East is still a bad weekend away from a bigger conflict. For crypto traders, this is important because rising energy costs could fuel inflation fears, put pressure on risk assets, and complicate the interest rate cut story that markets love so much.
Asian markets were mixed, but most major indices traded lower. Australia’s S&P/ASX 200 index fell by 1.32%, while the direct index line showed 8515.40, down 115.40 points or 1.34%. Japan’s Nikkei 225 (.N225) lost 0.92% to 60,843.09, down 566.20 points. The Topix index fell by 0.77%.
Asian stocks fall as bonds sell off and G7 ministers meet in Paris
South Korea’s Kospi (.KS11) recovered from early weakness and rose 1.15%. Its announced level reached 7609.73, an increase of 116.55 points, or 1.56%. The smaller Kosdaq index went the other way, falling 1.65%.
Hong Kong’s Hang Seng Index (.HSI) fell by 1.49%, while the quoted index level showed 25541.84, down 420.89 points, or 1.62%. The CSI 300 in mainland China was flat. The Shanghai Composite Index (.SSEC) fell 0.09% to 4,131,511, down 3,878 points. Taiwan’s TAEX index lost 1.02%. India’s Nifty 50 index (.NSEI) was unchanged at 23,643.50.
US stock futures were quiet after a record week. Dow Jones Industrial Average futures fell 100 points, or 0.2%. S&P 500 and Nasdaq-100 futures were close to flat. Traders were awaiting quarterly earnings from Nvidia (NVDA) and major US retailers.
The crisis was also on the agenda ahead of a meeting of G7 finance ministers on Monday in Paris. Eurogroup President Kyriakos Pirakakis, who is also Greece’s finance minister, said the conflict in the Middle East showed how vulnerable the global economy is when one region begins to choke off energy supplies.
“Opening the Strait of Hormuz and permanently ending the conflict are of paramount importance in mitigating the impact on the economy,” Kyriakos said.
The Eurogroup represents finance ministers from eurozone countries. Kyriakos represents the group at the G7 meeting. The main members of the G7 are the United States, the United Kingdom, Canada, France, Germany, Italy, and Japan.
“The European economy has proven its resilience in the face of this energy crisis,” Kyriakos said. “However, the global economy will feel the pressure – even if the conflict is resolved quickly.”
