Energy prices broadly tumbled and global stocks rose Monday — but only moderately — after the U.S.and Iran said they had reached an agreement to end fighting and reopen the Strait of Hormuz.Subscribe to read this story ad-free Get unlimited access to ad-free articles and exclusive content.The price of U.S.
crude oil slid more than 5% in early Monday trading to around $80 per barrel, while international Brent crude fell about 4.5% to $83 per barrel.For both benchmarks, these levels were the lowest since the first week of March, just days after the war with Iran was launched.Heating oil, a proxy for jet fuel, declined by 3%, while wholesale gasoline prices dropped 4%.
Natural gas futures fell 3%.Leading up to Sunday’s announcement, oil prices had already tumbled more than 6% over the last week in anticipation of an agreement.Around the world, stock markets jumped on the news.
Europe’s Stoxx 600 index hit a fresh record high Monday after rising nearly 1%.U.S.
stock futures pointed to even sharper upsides.S&P 500 futures rose 1.4%, Nasdaq 100 futures soared 2.2% and Dow futures rose 500 points before trading opened Monday.Some of the stocks set to jump the most at the open included airline and travel related stocks.
Shares of AI-linked tech companies were also set to rise on hopes that inflation and higher interest rates from the energy shock would fade.Still, oil prices begin the week 40% higher than they were at the start of the year.Retail gas prices remain elevated too.
The average price of retail unleaded gasoline sits at $4.07 per gallon, 36% higher than on February 28.“Financial markets are once again excited about a potential Middle East peace deal and the possible resumption of energy flows out of the Gulf,” analysts at ING said on Monday.“Whether that delivers much lower energy prices is highly questionable.”“What is clear, however, is that the inflation genie is out of the bottle and very few central banks can look through thi...