Oil prices moved higher on Monday as uncertainty surrounding the reopening of the Strait of Hormuz continued to unsettle energy markets. Brent crude climbed 0.9% to $84.32 per barrel. Meanwhile, US crude increased 0.7% to $78.74. Commercial shipping through the strategic waterway remains heavily disrupted.
Iran said an agreement with Oman on alternative shipping routes was nearing completion. However, Tehran indicated that the waterway would reopen only after the United States meets additional conditions.
Hormuz Disruption Supports Oil Prices
The latest increase reflects concerns about global energy supplies. The Strait of Hormuz serves as a crucial route for international oil shipments. Therefore, any prolonged disruption could keep oil prices under pressure. Markets are also watching developments around a broader Gulf peace agreement and its potential impact on energy flows.
Meanwhile, Asian stock markets gained modestly after Wall Street advanced. A weaker US jobs report reduced expectations of an immediate interest rate increase.
Japan’s Nikkei rose 0.6%, while South Korea’s benchmark index gained 0.5%.
US Inflation Data in Focus
Investors are now turning their attention to the US consumer price report due Wednesday. Analysts expect headline inflation to rise 0.1%. They also forecast a 0.2% increase in core inflation.
A stronger reading could revive expectations of a Federal Reserve rate increase in September. However, markets currently see a lower probability of such a move.
Futures indicate around a 44% chance of a September rate increase, down from 67% one week earlier.
Strong Corporate Earnings Support Stocks
Wall Street also benefited from strong corporate earnings. The Nasdaq gained 5% last week as several major technology companies reported solid results. Bank of America analysts said S&P 500 earnings per share increased 30% year-on-year. The earnings beat rate reached 76%, matching its strongest level since 2021.
AI-related companies continued to lead growth. Analysts reported median EPS growth of 28% for AI-linked companies, compared with 12% for others. Meanwhile, gold remained near $4,342 an ounce after gaining more than 7% last week. Lower bond yields continued to support demand for the precious metal.
Markets now face a closely watched week. Oil supply risks, US inflation and interest-rate expectations could shape investor sentiment across global markets.
