Oil prices tumbled and stocks jumped on Monday after President Trump called off strikes on Iranian energy infrastructure because of “productive” talks with Iran.
Despite Tehran responding that no such talks were taking place, the big reversal from earlier in the day mostly held. Investors are braced for the start of a fourth week of market turmoil caused by the war in the Middle East as a wave of strikes on Iran knocked out power across large parts of Tehran on Monday.
Oil prices tumble.
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The price of Brent crude, the global benchmark, fell to just above $100 a barrel. Brent settled at $112.19 a barrel on Friday.
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West Texas Intermediate crude, the U.S. benchmark, declined to about $90 a barrel. W.T.I. settled at $98.23 on Friday.
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Investors and analysts across the world are focused on the Strait of Hormuz, a vital trading route for oil and natural gas that normally carries as much as one-fifth of the world’s oil supply. Shipping traffic exiting the Persian Gulf through the strait has been effectively halted because of the risk that vessels could be attacked.
Global stocks recover.
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The S&P 500 opened nearly 1.5 percent higher. On Friday, the index had closed 1.5 percent lower.
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Stocks in Europe reversed earlier declines, with the Stoxx 600, a broad European index, rising more than 1 percent in afternoon trading. The DAX in Germany jumped nearly 2 percent, and the FTSE 100 in Britain was up slightly.
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Stock markets in Asia, where economies are especially vulnerable to the shock of rising energy costs, tumbled on Monday.
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The worst performer was the Kospi index in South Korea, which plummeted 6.5 percent. The Nikkei index in Japan dropped 3.5 percent, and the Hang Seng Index in Hong Kong traded 4 percent lower. But Asian markets closed before Mr. Trump’s comments.
U.S. gasoline prices continue to climb.
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Gas prices rose again on Monday, with the national average at $3.96 a gallon, according to the AAA motor club. The increase has raised the cost for drivers almost 33 percent since the war began.
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Diesel prices have increased even more quickly, reaching $5.29 a gallon, up 41 percent since the start of the war, on Sunday.
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