oil market

Published on
12/08/2026 – 16:50 GMT+2

Two of the most influential voices in energy markets set out opposing readings of the year on Wednesday.

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The IEA now expects the world to burn less oil in 2026 than it did in 2025, its first such call since Covid-19 ground the global economy to a near-halt, while OPEC still pencils in growth, leaving them more than two million barrels a day apart.

The Paris-based IEA now expects global oil demand to fall by 1.6 million barrels per day (mb/d) in 2026, a downgrade of 510,000 b/d from July.

“The ongoing closure of the Strait of Hormuz and elevated fuel prices continue to weigh on oil consumption,” it said, cutting its second-half forecast by roughly 550,000 b/d.

OPEC still expects demand to grow, though its estimate has been trimmed for a fourth consecutive month, to 580,000 b/d from 780,000 b/d.

The producer group has consistently argued the war has done less damage to consumption than Western forecasters believe, and the two sets of numbers imply a difference of about 2.2 mb/d in what the world will burn this year.

Supply still 6.3 million barrels short

The supply picture explains the pessimism.

Global production rose by 2.4 mb/d to 101.5 mb/d in July but remained 6.3 mb/d below year-earlier levels, with 8.3 mb/d of Gulf output still shut in.

Gulf production climbed to 23.9 mb/d, yet regional exports fell 2.1 mb/d to 15 mb/d after the Strait of Hormuz was effectively closed again in early July and tankers and infrastructure came under attack, with loadings sliding from 20 mb/d to around 12 mb/d.

With no deal to reopen the waterway or secure passage through Bab el-Mandeb, the IEA cut its supply forecasts again and now expects output to fall by 4.3 mb/d this year.

Observed global stocks also dropped by 69 million barrels in July to just under 7.9 billion, down 410 million since the war began.

Both bet on 2027

Where the two agree is next year.

OPEC now expects demand to grow by 2.2 mb/d in 2027, an upgrade from the 1.94 mb/d it forecast last month, while the IEA goes further still at 2.4 mb/d.

That is an inversion worth highlighting, as the gloomier forecaster for this year delivers a more bullish read for the next.

The IEA reads the damage as a blockage rather than a collapse, oil that cannot reach buyers rather than demand that has vanished, so the deeper this year’s hole, the steeper the climb out of it once Hormuz reopens.

OPEC, which never accepted that consumption fell much, has less ground to make up for.

The agency’s outlook rests explicitly on de-escalation, assuming flows gradually recover and turning this year’s supply contraction into growth of 8.3 mb/d, flipping a 1.3 mb/d deficit into a 4.6 mb/d surplus.

Published on
12/08/2026 – 8:34 GMT+2

Oil prices climbed and world stocks were mixed on Wednesday, with Asian shares mostly higher even as Wall Street slipped further from last week’s record highs, as investors awaited a crucial US inflation reading and watched for any breakthrough in the stalled Iran war talks.

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The price of a barrel of Brent crude, the international benchmark, was up 0.9% at $89.67 early on Wednesday. US benchmark crude picked up 0.9% to $83.98.

Gold edged up 0.8% to $4,400.44 an ounce, while silver gained 1% to $65.30 an ounce.

Iran has rejected a comment by US President Donald Trump suggesting that, since Tehran is seeking compensation as part of any talks to end the war, Washington would demand the same.

The United States and Israel attacked Iran in late February, a strike that led to the closure of the Strait of Hormuz and kept much of the world’s oil pent up in the Middle East. Last month alone, Brent’s price swung between $72 and $102 a barrel.

Meanwhile, an attack by Iran-backed Houthi rebels on a vessel in the Bab el-Mandeb strait, off Yemen’s southern tip, has raised concerns that the violence could reignite civil war and further threaten regional shipping routes.

Higher oil prices worsen inflation, and they have pushed the average cost of a gallon of regular petrol in the US to $4.01, according to AAA — up from less than $3.14 a year ago.

That has Wall Street’s attention fixed on Wednesday, when the US government releases its latest monthly inflation reading. Economists expect it to show inflation slipped to 3.4% in July from 3.5% in June.

On Tuesday, the S&P 500 fell 0.3% for a second modest drop since setting its all-time high on Friday. The Dow Jones Industrial Average dipped 184 points, or 0.3%, and the Nasdaq Composite sank 0.6%.

Cooler inflation could ease pressure on the Federal Reserve to raise interest rates to tamp down price increases.

Higher rates could curb inflation, but they would also drag on the wider US economy by making it more expensive for households and businesses to borrow, while undercutting prices for stocks and other investments.

Treasury yields have jumped since the war with Iran began, driven by higher oil prices and inflation worries, sending long-term US mortgage rates to their highest levels in a year.

Tokyo’s Nikkei 225 gained 0.6% to 67,334.94.

In South Korea, the Kospi jumped more than 4% to 6,597.90 on renewed buying of computer chipmakers. Samsung Electronics gained 7.7% and memory chipmaker SK Hynix rose 7.1%.

Taiwan’s Taiex advanced 0.8%.

The Shanghai Composite index added 0.3% to 3,946.51, while Hong Kong’s Hang Seng slipped 1.2% to 25,352.13.

In Australia, the S&P/ASX 200 lost 0.6% to 9,197.00.

In other early Wednesday dealings, the dollar rose to 159.41 yen from 159.30 yen. The euro slipped to $1.1535 from $1.1544.

Additional sources • AP

Published on
11/08/2026 – 13:25 GMT+2

Crude and US Treasury yields rose together as traders judged that the exchange of compensation demands between the US and Iran has pushed any potential deal further out of reach.

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The US president said on Monday he had told his negotiators to seek payment from Iran for Americans killed and wounded in attacks he attributes to Tehran going back decades, including the bombing of the USS Cole in the year 2000 and for Iranians killed in protest crackdowns.

In a follow-up post on Truth Social he expanded on the demand, saying Iran should also pay for “the damages and death caused to the people of Lebanon, Syria, Yemen, and Gaza”.

Tehran, whose representatives had sought compensation for five months of US and Israeli bombardment, says the Strait of Hormuz will stay shut until Washington lifts its naval blockade, ends sanctions and releases frozen Iranian assets.

The front month contract on Brent traded at around $89.8 a barrel on Tuesday and West Texas Intermediate at about $84.2, both up roughly 2.5%.

The US bond market read it the same way, with yields rising across the US curve in a modest global sell-off, the two-year over 4.25%, the ten-year above 4.7% and the thirty-year higher than 5.27%. The yields for all durations are trading at the highs of this year.

Since yields move inversely to prices, the rise means investors are selling government debt as they expect that costlier oil will feed into inflation and strengthen the case for higher interest rates.

Money markets now put roughly even odds on a Federal Reserve rate hike in September, with July inflation data due on Wednesday.

Control claimed, traffic missing

The current stalling of US-Iran negotiations is deliberate as US President Donald Trump appears to have been favouring a slower approach as of late.

The US president told Axios in an interview published on Sunday that the US is “low-keying it,” meaning Washington was only semi-negotiating and content to watch Iran’s inflation and empty coffers do the work, a signal he is prepared to let economic pressure mount rather than order a fresh military campaign.

In the Oval Office on Monday, he struck a triumphant note, claiming the US controls “100%” of the Strait of Hormuz, that only the US Navy holds sway in the region, that American forces have swept it clear of Iranian mines and that the blockade of Iranian ports is impenetrable.

However, shipping data tells another story.

Confirmed crossings have run at 6 to 11 vessels a day recently, against the 130 to 140 daily before the war, according to Kpler data, leaving traffic at a fraction of normal levels throughout the five-month conflict.

Published on
10/08/2026 – 7:43 GMT+2

Oil prices rose in early trading on Monday as market participants weighed mixed signals from the US and Iran, with concerns that a deal to reopen the Strait of Hormuz could take longer to materialise.

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Futures for international benchmark Brent crude for October delivery gained 1.04% to $84.42 a barrel, while US West Texas Intermediate futures for September advanced 0.83% to $78.83 a barrel.

Iran’s Revolutionary Guards insisted on Sunday that they would not reopen the Strait of Hormuz until the US complied with a list of demands.

Tehran insists on retaining control of the waterway – through which a fifth of world oil and LNG pass – after the war and wants to charge tolls for passage, which Washington has pushed back against.

Attacks in the strait, which was free to transit before the war, led to the collapse of an April ceasefire, and mediators have urged both sides to return to the terms of a subsequent June memorandum that set out a path for peace talks.

Iran on Saturday released a list of conditions for reopening the strait, including an end to the war on all fronts, the lifting of a US counterblockade of Iranian ports, the end of sanctions, the release of frozen assets and compensation for wartime damage, the Tasnim news agency reported.

Those conditions echoed the terms of the June agreement, which included a provision to create a $300 billion reconstruction fund for Iran.

Iran’s Revolutionary Guards said on Sunday that their strategy was to maintain their blockade “until the enemy accepts all our conditions… the strait is now actually a theatre of war for us and not just a waterway”.

For his part, US President Donald Trump said in an interview: “We are low-keying it.”

“We are only semi-negotiating with them,” he was quoted as saying. “We are just watching Iran with its huge inflation and the fact they have no money.”

“It will work out,” he added. “It’s like a chess game.”

Additional sources • AFP

Published on
04/08/2026 – 8:09 GMT+2

In addition to earnings reports this week, investors were also still weighing the impact from last week’s joint US-Japan currency intervention, analysts said.

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Japan’s benchmark Nikkei 225 slipped 0.3% to 63,585.58, as the US dollar inched up to 157.51 Japanese yen from 157.18 yen. The euro cost $1.1511, little changed from $1.1514. The dollar was trading at 160-yen levels before regulators stepped in to boost the yen’s value after it fell to nearly 40-year lows.

Some analysts said the effectiveness of such an intervention remains uncertain as it doesn’t address the fundamental economic reasons behind the currency fluctuations, including inflation, interest rates and the relative strengths of the economies.

“A US-backed operation carries far more signaling weight than Tokyo acting alone, and the pledge of further action will give speculators pause. But any US contribution will probably be constrained by size,” a report by BMI, a unit of Fitch Solutions, said.

Matthew Ryan, head of market strategy at global financial services firm Ebury, noted the latest effort could have some impact because it appears to signal a real change in monetary policy rather than just a one-time defensive move.

“This is an historic and meaningful development for the yen, which materially improves confidence in our mildly bullish call for the currency,” he said.

Markets unsettled

South Korea’s Kospi sank 1.3% to 6,174.72. Australia’s S&P/ASX 200 added 1.2% to 9,129.00. Hong Kong’s Hang Seng fell 0.5% to 25,881.99, while the Shanghai Composite gained 0.2% to 3,802.61.

Markets remain unsettled by swings for stocks of companies that make computer chips. They’ve been veering up and down for weeks on worries about whether their surging revenues because of the artificial-intelligence boom are sustainable.

Dow hits all-time high

On Wall Street, share prices rallied Monday after easing oil prices helped calm worries over inflation. The S&P 500 jumped 1.5% and is just 0.1% below its record set earlier this summer.

The Dow Jones Industrial Average, which measures a narrower slice of the US stock market, climbed 693 points or 1.3% to an all-time high, while the Nasdaq composite leaped 2.1%.

Oil prices rebound

In energy trading in Asia early Tuesday, benchmark US crude gained 84 cents to $81.18 a barrel. Brent crude, the international standard, jumped $1.15 to $84.92 a barrel.

A day earlier, oil prices dropped more than 5% after US President Donald Trump said over the weekend that he had decided to hold off on new strikes against Iran at the urging of allies in the region.

Brent’s price careened between $72 and $102 last month as worries rose and fell over the war in Iran and when oil tankers would be allowed to freely exit the Persian Gulf again to deliver crude to customers worldwide.

The yield on the 10-year Treasury sank to 4.68% from 4.75% late Friday. It remains well above its 3.97% level from before the war with Iran.

Additional sources • AP

The price for a barrel of Brent crude oil for October delivery lost 5.16% to $83.39 a barrel, while US crude, or WTI, futures for September delivery declined nearly 6% to $79.66 per barrel.

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Crude declined after US President Donald Trump said fresh talks with Iran would begin later in the day, easing concerns over potential supply disruptions. Additional downward pressure came after Saudi Arabia, Russia and five other key members of OPEC+ agreed in an online meeting on Sunday to boost oil production by 188,000 barrels a day from September, against a backdrop of disruption caused by the Middle East conflict.

“The seven participating countries decided to implement a production adjustment of 188 thousand barrels per day,” they said in a joint statement.

The increase, decided by the key countries in the enlarged Organisation of the Petroleum Exporting Countries, was widely expected by analysts.

“OPEC+ has finished unwinding its voluntary cuts. The next challenge is managing the surplus that could emerge as export flows normalise,” Jorge Leon, analyst at Rystad Energy, said.

He warned, however, that the decision “changes little in the near term because (the Strait of) Hormuz remains constrained. The real market impact will come when normal export flows resume.”

The Gulf countries have struggled to increase exports due to the near-paralysis of the Strait of Hormuz orchestrated by Iran during the war in the Middle East – despite a brief upswing in shipping traffic after a US-Iran memorandum of understanding was signed in June.

Many OPEC+ members cannot produce as much oil as their official targets allow due to a “decline in production capacity”, so increasing targets has become less meaningful, Giovanni Staunovo, an analyst at UBS, said.

Future pause foreseen

The September increase, agreed by OPEC+ countries Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman, completes the unwinding of the second of the three production-cut packages introduced by organisation.

“Having completed the restoration campaign, OPEC+ has little incentive to rush into further supply changes. Our base case is a fourth-quarter pause while the group prepares for the 2027 quota negotiations,” Rystad Energy’s Leon said.

“For now, geopolitics is masking the scale of the supply increase. That will become much clearer once export flows normalise,” he added.

It remains unclear when the group will actually be able to increase its oil volumes. Some member countries, such as Iraq, have expressed a desire to significantly boost production.

Russia, though, is confronted with repeated Ukrainian drone attacks on its oil infrastructure that have crimped production, currently hovering around nine million barrels per day – compared with a target of 9.8 million barrels per day.

OPEC+ “faces potentially difficult talks over new production quotas” starting next year following the September increase, according to analysts at DNB Carnegie.

Between late 2022 and 2023, OPEC+ became concerned that oil prices were falling, and agreed to cut oil production in three separate rounds, reducing total output by nearly six million barrels per day.

But Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, Oman and the United Arab Emirates – before the latter’s exit from the group on May 1 – then changed their strategy by gradually upping production starting in 2025.

“I don’t think cohesion is at risk at this very moment,” Leon said, warning, however, that the UAE’s withdrawal from the group in May has highlighted a weakness in this area.

Published on 13/07/2026 – 6:56 GMT+2•Updated
6:59

The price of Brent crude, the international benchmark, gained 3.9% to $78.96 per barrel, while the US benchmark crude oil price rose 4% to $74.26 per barrel.

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Prices for both types of crude oil had recently slipped back to the levels seen before the war with Iran began, after the two sides reached an interim agreement to end the conflict and ships resumed transporting oil through the Strait of Hormuz.

However, the United States launched several waves of strikes on Iran early on Monday morning following an Iranian attack on a container ship in the Strait of Hormuz that set the vessel ablaze and left one crew member missing over the weekend. Iran retaliated by targeting countries across the Middle East.

US stock futures fell, with the contract for the S&P 500 down 0.4% and that for the Dow Jones Industrial Average 0.3% lower. Nasdaq Composite futures lost 1%.

In Asian trading, Tokyo’s Nikkei 225 index lost 1.1% to 67,786.86, while in Seoul, the Kospi declined 5.6% to 7,060.69.

Shares in South Korean memory chipmaker SK Hynix, which soared 13% on their Wall Street debut on Friday, slumped 10.6% in Seoul. Its bigger rival, Samsung Electronics, fell 6.7%.

Elsewhere in Asia, Hong Kong’s Hang Seng edged 0.1% higher to 24,202.41, and the Shanghai Composite index shed 1.2% to 3,947.34.

In Australia, the S&P/ASX 200 declined 0.3% to 8,777.00.

US stocks ticked higher on Friday after investors showed sustained appetite for winners of the artificial intelligence (AI) boom. The S&P 500 rose 0.4% and the Dow Jones Industrial Average added 0.3%. The Nasdaq Composite climbed 0.3%.

SK Hynix’s shares jumped after trading began at midday after it raised roughly $26.5 billion by selling American depositary shares at a price of $149 each.

SK Hynix’s stock in Seoul had already surged more than 600% over the past year thanks to enthusiasm for AI. The boom has translated into real profits, driven by soaring demand for computer memory. But it has also raised concerns that AI stock prices have climbed too high and that the world’s spending on chips and data centres will not generate enough productivity and profit growth to justify the investment.

That has led to sharp swings in AI stocks, which have become some of Wall Street’s most influential because of their enormous market values.

Nvidia was the single biggest force lifting the S&P 500 on Friday, rising 4%.

Beyond the uncertainty surrounding AI, investors are turning their attention to the upcoming corporate earnings season.

Companies across industries will need to deliver strong profit growth to justify their elevated share prices, which remain close to record highs. This week will bring earnings reports from many of the biggest US banks, including Bank of America, Citigroup, JPMorgan Chase, Goldman Sachs and Wells Fargo, with several reporting on Tuesday alone.

Concerns about how the continued fighting with Iran will affect the global flow of crude oil are clouding the outlook for both energy costs and overall inflation.

High bond yields have been weighing on financial markets worldwide because more expensive oil and persistently high inflation could prompt the Federal Reserve and other central banks to raise interest rates.

Higher interest rates can help keep inflation under control, but they also slow economic growth and weigh on the prices of all kinds of investments.

Additional sources • AP

Published on
10/07/2026 – 13:58 GMT+2

Global oil demand will fall by one million barrels a day in 2026, the IEA said on Friday, making it the first annual contraction since 2020, when Covid lockdowns grounded aviation and shuttered industry.

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The comparison flatters this year’s decline in one respect, since demand collapsed by around eight million barrels a day at the height of the pandemic, but it underlines how severely the closure of the Strait of Hormuz has damaged the global economy.

The contraction is “highly skewed in both product and regional terms”, the agency noted in its monthly report.

Earlier IEA analysis traced the sharpest losses to Asia’s import-dependent economies and to petrochemical feedstocks such as naphtha and liquefied petroleum gas, whose supply chains run through the Strait of Hormuz.

At the time of writing, the front month contract on Brent crude, the international benchmark, was trading at around $76 a barrel, roughly 6% higher than before the US and Israel launched strikes on Iran in late February, and far below the peaks near $120 reached in March at the height of the conflict.

The US benchmark, WTI, was trading lower at around $72 a barrel.

June’s fragile rebound

Supply improved sharply last month, if from a desperately low base.

Global production jumped by 4.1 million barrels a day in June to 98.8 million as the partial reopening of the Strait of Hormuz allowed Gulf producers to restart shut-in wells, though output was still running 9.4 million barrels a day beneath its pre-war level.

Gulf exports, counting cargoes rerouted around the strait, climbed by 6.5 million barrels a day to 16.1 million. Before the fighting began in late February, the region shipped an average of 24 million barrels.

Global oil inventories grew for the first time since US and Israeli strikes on Iran ignited the conflict, halting months of record drawdowns, although stockpiles in the wealthiest economies shrank further as buyers held back from importing.

The truce unravels

The IEA’s forecasts rest on an assumption now under visible strain which is that a ceasefire holds and the Strait of Hormuz gradually reopens.

On that basis, global supply would contract by 3.7 million barrels a day this year, leaving production 860,000 barrels a day short of demand, before expanding by 7.5 million next year and tipping the market into surplus.

Stronger output elsewhere and weaker demand than expected before the war could still restore a surplus by the end of the year, allowing countries to rebuild depleted reserves, the IEA noted.

This week brought the second and far larger breach of last month’s truce.

After Iranian forces struck three commercial vessels on Monday and Tuesday, US Central Command hit more than 80 targets across Iran, including air defences, coastal radar and over 60 Revolutionary Guard small boats, while Washington revoked the licence permitting Iranian oil exports.

Iran fired drones and missiles at Bahrain and Kuwait, causing no major damage, and US President Donald Trump has since declared the ceasefire over.

Tehran insists the only safe passage is the route it sets in the Strait of Hormuz as traffic fell to 13 tankers on Wednesday, against an average of 33 a day the previous week, according to shipping data from Kpler.

Additional sources • AFP

Shares fell on Wednesday in Europe and Asia, and oil prices surged nearly 6% after US President Donald Trump said the tentative ceasefire with Iran was over, raising the prospect of renewed military conflict between the two countries.

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Asked whether the memorandum of understanding with Iran was over, Trump told reporters at the NATO summit in Ankara: “To me, I think it’s over. I don’t want to deal with them,” according to Reuters.

This came after US Central Command said its forces struck more than 80 targets in Iran overnight, including command-and-control networks, coastal radar installations, anti-ship missile capabilities and vessels operated by the Islamic Revolutionary Guard Corps (IRGC). Washington also revoked a waiver that had allowed Iran to restart oil exports.

Brent crude, the international standard, jumped more than 6% by 10:45 CEST to $78.79 a barrel, while US benchmark crude rose 6.3% to $74.88 a barrel. Both had declined recently to around the levels seen before the war with Iran began in late February.

The latest flare-up, despite commitments to seek a peaceful resolution to the conflict, has added to uncertainty over oil prices after they fell from their peak well above $100 during the war. It also comes amid worries that the craze for artificial intelligence-related shares has pushed prices beyond the productivity gains and profits likely to result from massive investments in computer chip production capacity and data centres.

“As such, geopolitical headlines will likely determine market sentiment over the coming hours. A further deterioration in the situation could weigh further on equity valuations along with rising stress in technology,” Ipek Ozkardeskaya of Swissquote said in a commentary.

Stock markets fall

In share trading, Germany’s DAX shed more than 2.2%, at around 11 CEST, while the FTSE 100 in London lost 1.5%, and France’s CAC 40 fell more than 2%.

US stock futures were down about 1% at the same time.

In Asia, Tokyo’s Nikkei 225 lost 2.1% to 66,819.05, while South Korea’s Kospi shed 5.4% to 7,246.79.

The South Korean index has soared and then fallen back, briefly surpassing the 9,000 level last month before succumbing to heavy selling in AI-related technology shares such as Samsung Electronics and SK Hynix. Samsung fell 6.3% early Wednesday after dropping about 7% the day before. SK Hynix reversed early gains to fall 5.7%.

Taiwan’s Taiex rose 0.6%. In Hong Kong, the Hang Seng rose 3% to 24,193.56.

Shares in Chinese AI model start-up Zhipu, also known as Z.ai and traded as Knowledge Atlas Technology, rose nearly 14% on Wednesday.

The Shanghai Composite index declined 0.5% to 3,970.88.

On Tuesday, the roller-coaster ride for AI stocks turned lower again, dragging Wall Street down. The S&P 500 fell 0.4%, though the majority of stocks within the index rose.

Losses among AI-related stocks dragged the Nasdaq Composite 1.2% lower, while the Dow Jones Industrial Average fell 0.2%.

Advanced Micro Devices sank 6.5%, Intel shed 9.7%, and Micron Technology lost 4.7%.

SpaceX, which owns the xAI business, fell 6.8% on its first day of trading in the Nasdaq-100 index.

Rivian Automotive dropped 18.1% after the electric vehicle company said it would sell 75 million shares, diluting existing shareholders’ stakes.

In currency trading early Wednesday, the US dollar rose to 162.26 Japanese yen from 162.11 yen. The euro climbed to $1.1426 from $1.1414.

Brent crude edged 2.5% higher on Tuesday and seems to have steadied around $100 per barrel at the time of writing, as US-Iran negotiations stall.

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On the other hand, WTI dropped over 4% and is trading around $92.6 per barrel.

Overall, oil prices were declining since last Wednesday as the framework for a peace deal, or at least a longer and more encompassing ceasefire, between the US and Iran was seemingly on the verge of being agreed.

However, Iran accused the US of breaching the current ceasefire after Washington carried out what it described as defensive strikes in the southern part of the country.

Iran’s foreign ministry stated that the US attacks in the Hormozgan province, where Iranian media reported hearing explosions early Tuesday, amounted to a “serious violation” of the fragile ceasefire that has been in effect for almost seven weeks.

Meanwhile, US Secretary of State Marco Rubio said negotiations aimed at ending the conflict could require “a few days” to reach an agreement.

On Monday, US President Donald Trump also reiterated nuclear demands in a social media post, as tensions continue to surround the fundamental aspects of a possible agreement.

Investors appear to have mixed reactions to the developments with some markets seeming to price in a decrease in the probability that a deal is imminent.

In Europe, the Euro Stoxx 50 has fallen more than 0.7% while the broader pan-European Stoxx 600 is trading around 1% lower as we approach the close of Tuesday’s session.

The UK’s FTSE 100, Germany’s DAX 30, France’s CAC 40, Italy’s FTSE MIB, the Netherlands’ AEX and Switzerland’s CH20 have all dropped between 0.1% and 0.7%.

Over in Asia, Japan’s Nikkei 225 and Taiwan’s TAIEX closed flat, but South Korea’s KOSPI jumped 2.5% primarily driven by a continuous demand for AI-related equities.

However, US markets appear completely decoupled from other indices and the broader situation. Not only have WTI prices continued to fall on Tuesday but the S&P 500 also opened 0.6% higher.

Latest on the Strait of Hormuz

Both the US and Iran had signalled headway toward a memorandum of understanding that could end the conflict and resume maritime traffic through the blocked Strait of Hormuz, while allowing negotiators a 60-day window to tackle more complicated matters such as Iran’s nuclear activities and supplies.

In his latest remarks, US Secretary of State Marco Rubio stated that the Strait of Hormuz must remain accessible “one way or the other” as traffic through the chokepoint has dropped sharply, with only a few dozen ships currently using the route each day, compared with the usual 125 to 140 vessels.

Iran has continued to permit limited shipping, prioritising vessels connected to allied or friendly nations and arranging passage through state-to-state agreements.

Continuous reports of attacks in the Strait of Hormuz underscore how far from the normalisation of energy flows and other supplies the global economy still is.

On Tuesday, the United Kingdom Maritime Trade Operations (UKMTO) reported that a tanker experienced an external blast near the waterline on its port side.

According to the agency, the vessel was located about 60 nautical miles from Muscat, the capital of Oman.

UKMTO said the tanker and all crew members were unharmed, although a quantity of bunker fuel spilled into the sea.

This is the most recent reported incident near the Strait of Hormuz at the time of writing.