US stock markets closed higher on Monday after a volatile session driven by sharp swings in oil prices, which surged past $100 a barrel before retreating following comments from President Donald Trump. Trump stated that the US-Israel war with Iran is 'very complete,' helping to calm markets and bring oil prices down to $85 a barrel by the close of trading.
The Dow Jones Industrial Average jumped 230 points, while the S&P 500 and Nasdaq rose 0.83% and 1.38%, respectively. Earlier in the day, oil prices had hit a four-year high above $100 a barrel, rattling Asian and European markets. Brent crude briefly reached $119.50 a barrel, a 29% increase, before falling back.
The volatility was triggered by escalating conflict in the Middle East, including airstrikes on energy sites in and around Tehran and the effective closure of the Strait of Hormuz, a critical trade artery. Kuwait announced a precautionary production cut, and Bahrain declared force majeure on oil shipments after an Iranian attack set its refinery ablaze.
European and Asian markets suffered significant losses. The UK's FTSE 100 fell 1%, Germany's Dax dropped 1.2%, and France's Cac 40 declined 1.8%. Japan's Nikkei 225 slumped 5%, South Korea's Kospi fell 6.6%, and Australia's ASX 200 ended 2.9% lower.
Reports that G7 finance ministers might discuss a joint release of petroleum from strategic reserves helped ease prices. Trump described the surge as a 'very small price to pay' for peace, while Iran warned that oil could exceed $200 a barrel if the conflict continues.
