Oil prices jumped sharply on Monday and stocks fell in volatile trading amid a flare-up in the conflict in the Persian Gulf and deepening uncertainty over the near-total shutdown of ship traffic through the Strait of Hormuz.
New attacks were reported in the United Arab Emirates and Oman, and U.S. Central Command said Navy ships shot down Iranian cruise missiles and drones that had been fired at ships. On Sunday, President Trump had said that the United States would “use best efforts” to get ships out of the strait that were not involved in the conflict but offered scant details about how the process would unfold.
But Iran rejected the U.S. efforts and threatened to attack American warships and any commercial vessels that might try to move through the strait.
Oil jumps.
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The price of Brent crude, the global benchmark for oil, rose 6 percent on Monday to about $115 a barrel.
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West Texas Intermediate crude, the U.S. benchmark, rose 4 percent, trading at roughly $106 a barrel.
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Since the United States and Israel struck Iran on Feb. 28, investors and analysts have been keenly focused on the continued disruption to shipping in the Strait of Hormuz, the narrow waterway between Iran and Oman that is a vital trading route for oil and natural gas and that normally carries as much as one-fifth of the world’s oil supply.
Stocks drop.
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The S&P 500 fell about 0.5 percent on Monday, after notching its fifth straight week of gains on Friday.
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In Europe, the Stoxx 600, a broad-index that tracks the region’s largest companies, fell 0.9 percent. Markets in Britain were closed for a holiday.
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Stocks in Asia, where countries import vast quantities of oil and gas, were mostly higher. Stock markets in Taiwan and South Korea surged more than 4 percent, as semiconductor shares rose. Markets in Japan and China were closed for a holiday.
Gasoline prices rise.
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Gas prices rose a notch on Monday to a national average of $4.46 a gallon, according to the AAA motor club. The increase has raised the cost for drivers by just shy of 50 percent since the war began.
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Gas prices do not move in lock step with crude, usually trailing increases or decreases by a few days.
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Diesel prices stood basically even at $5.64 on Monday, up just over 50 percent since the start of the war.
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