The oil market is in a state of intense uncertainty as the Middle East war continues to affect prices. Specifically, oil prices increased on Tuesday (7/4), while stocks showed modest gains following new threats from Donald Trump toward Iran to open the Strait of Hormuz or be “decimated.”
Oil: Upward trends in prices
More specifically, West Texas Intermediate is trading at $115 — the highest level in the past month — and Brent above $111. US President Donald Trump warned Tehran that its political infrastructure would be destroyed if it doesn’t allow ships to pass through the Strait of Hormuz. Trump stated that “the entire country” of Iran “could disappear in one night and that night could be tomorrow” if his ultimatum to open the Strait of Hormuz is not met.
Stock markets showed mixed results: Tokyo remained unchanged, while Shanghai, Sydney, Seoul, Taipei, Wellington, Manila and Bangkok recorded gains, along with London, Paris and Frankfurt. Conversely, Singapore, Mumbai and Jakarta declined.
“Financial markets are moving in a narrow and uncertain range as investors watch the countdown to Trump’s deadline for Iran,” wrote Stephen Innes of SPI Asset Management. “Signs of a potential ceasefire offer temporary relief, but don’t fully offset the ongoing escalation risk,” he added.
Key oil market data
West Texas Intermediate: up 2.2% to $114.92/barrel
North Sea Brent: up 1.4% to $111.35/barrel
Tokyo – Nikkei 225: unchanged at 53,429.56 (close)
Shanghai – Composite: up 0.3% to 3,890.16 (close)
London – FTSE 100: up 0.2% to 10,460.62
Hong Kong – Hang Seng: closed due to holiday
