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Oil prices extended their gains Monday as fresh exchanges of fire between the United States and Iran around the Strait of Hormuz, along with the risk of mines, further weighed on commercial shipping through the waterway.
Both international benchmarks, Brent and U.S. West Texas Intermediate, rose more than 1% at their intraday highs, topping $97 and $93 per barrel, respectively, before paring some of their gains.
European gas prices also rose, with futures at the Dutch TTF hub adding more than 3% to reach €75.2 ($87.3) per megawatt-hour, their highest level since late 2022.
Asian markets traded mixed as artificial intelligence-driven technology stocks advanced despite the possibility of a U.S. Federal Reserve rate hike and rising geopolitical uncertainty.
Japan's Nikkei 225 index closed 2.1% higher, while South Korea's Kospi index closed 4.6% higher. China's Shanghai Composite closed the session slightly higher, while Hong Kong's Hang Seng dropped 0.9%.
After the opening, the pan-European Stoxx Europe 600 benchmark index fell 0.1%, Britain's FTSE 100 declined 0.1%, France's CAC 40 and Germany's DAX 30 also edged lower, while Spain's IBEX 35 gained 0.1%. Futures tied to major U.S. indexes were mixed, with the technology-heavy Nasdaq rising 0.3%.
Gold retreated 0.2% to around $4,420, while silver declined 0.4% to $66 per ounce. Palladium and platinum rose, gaining 1.1% and 0.3% to $1,390 and $1,820 per ounce, respectively.
Bitcoin meanwhile retreated 0.5% to $79,450, while ethereum slid 0.3% to $2,490. Total cryptocurrency market capitalization declined 0.4%.
The rise in energy prices was largely driven by concerns that escalating tensions between the U.S. and Iran could further disrupt energy supplies from the Persian Gulf.
The U.S. military announced Saturday that it had destroyed three Iranian oil tankers after Iran targeted two U.S. Navy warships with ballistic missiles.
Iran then said it had retaliated by targeting three oil tankers and three U.S.-linked vessels, while the IRGC claimed it had fired ballistic missiles at a U.S. aircraft carrier and a destroyer.
Mohsen Rezaei, secretary of Iran's Supreme National Security Council, announced that an agreement with Oman to establish a new corridor through the Gulf of Oman and Strait of Hormuz, with Iran controlling its entry and exit points, would be signed in the coming days.
Rezaei said the area would extend from the zone where the U.S. was enforcing a naval blockade through the Strait of Hormuz and the Persian Gulf. He warned that any vessel entering the newly designated area without authorization would be blacklisted by Iran.
Amid the tensions, an average of 10 commodity ships per day transited the Strait of Hormuz over the past 10 days, the lowest level since May, according to shipping data released Monday.
Only two vessels passed through the strait Saturday, while six went through Sunday, most using the Iranian route, Reuters reported.
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