London (AFP) – Global stock markets fluctuated and oil prices jumped Friday at the end of a volatile week’s trading unleashed by the Middle East conflict. Stock markets have been rattled by the US-Israel war on Iran and Tehran’s retaliatory attacks across the Gulf region, which have upended the world’s energy and transport sectors.
Crude prices have soared more than 20 percent in a week, with traffic having all but dried up in the Strait of Hormuz, through which a fifth of the world’s oil supplies and a substantial amount of gas run. The surge in energy prices has fanned fears of a fresh spike in inflation that could hit the global economy and curb cuts to interest rates. International benchmark oil contract, Brent North Sea crude, rose more than two percent on Friday, while the main US contract WTI topped $80 a barrel for the first time since January last year.
“The longer that key energy infrastructure and shipping routes in the region are affected, the greater the chance of a significant inflationary impact,” said AJ Bell investment director Russ Mould. London, Paris, and Frankfurt stock markets all traded lower around midday. Major Asian markets closed higher after a fresh retreat Thursday on Wall Street.
The Middle East conflict looks set to be drawn out, with Iranian Foreign Minister Abbas Araghchi on Thursday warning that the Islamic republic was not asking for a ceasefire. US Interior Secretary Doug Burgum said officials were looking at plans to temper oil price gains, telling Bloomberg his country might tap its own reserves. With that in mind, the White House on Thursday temporarily eased sanctions against Russia to allow its oil currently stranded at sea to be sold to India until April 3.
International Energy Agency chief Fatih Birol sought Friday to tamp down fears of a global oil crisis, saying there was “plenty of oil in the market”. Earlier this week, US President Donald Trump pledged to protect ships through the Strait of Hormuz, but shipping companies have exercised caution in the region. Danish shipping giant Maersk said on Friday it was suspending two intercontinental transit routes because of the war, after already suspending bookings in the Gulf. Other countries have also moved to address the issue, with China asking its largest oil refiners to suspend exports of diesel and gasoline, according to Bloomberg News.
The latest US jobs report will be released later in the day, which investors will look to for fresh signs about the Federal Reserve’s interest rate decisions.
– Key figures at around 1115 GMT –
Brent North Sea Crude: UP 2.7 percent at $87.74 per barrel
West Texas Intermediate: UP 4.5 percent at $84.68 per barrel
London – FTSE 100: DOWN 0.1 percent at 10,404.10 points
Paris – CAC 40: DOWN 0.2 percent at 8,027.22
Frankfurt – DAX: DOWN 0.2 percent at 23,770.51
Seoul – Kospi: FLAT at 5,584.87 (close)
Tokyo – Nikkei 225: UP 0.6 percent at 55,620.84 (close)
Hong Kong – Hang Seng Index: UP 1.7 percent at 25,775.29 (close)
Shanghai – Composite: UP 0.4 percent at 4,124.19 (close)
Euro/dollar: DOWN at $1.1577 from $1.1604 on Thursday
Pound/dollar: DOWN at $1.3333 from $1.3357
Dollar/yen: UP at 157.87 yen from 157.55 yen
Euro/pound: DOWN at 86.84 pence from 86.87 pence
© 2024 AFP
