Oil prices surged and global stock markets faced pressure on Monday after fresh hostilities between Israel and Iran dashed hopes for a lasting ceasefire. Brent crude rose by about 5% to over $97 a barrel, though remaining below the $100 mark and the April peak of $120.
The escalation followed Iran's missile launch at Israel—the first since a fragile ceasefire in April—and Israel's retaliatory airstrikes early Monday. Asian markets bore the brunt, with Japan's Nikkei 225 falling 3.8% and South Korea's Kospi plunging over 8%, triggering circuit breakers.
European markets opened lower but with more modest losses. The UK's FTSE 100 dipped 0.3% to 10,336, Germany's Dax fell 0.8%, and France's Cac 40 dropped 0.6%. The sell-off followed a weak session on Wall Street on Friday, where the S&P 500 lost 2.6% amid renewed inflation concerns.
Richard Hunter, head of markets at Interactive Investor, described the situation as an 'ugly collision' of technology, economics, and geopolitics, driving a global selling spree. He noted that oil price rises add to inflationary pressures facing the world in coming months.
