Stable markets, oil remains above 100 dollars, US

Oil prices rose at the start of the week, with increasing uncertainties surrounding US-Iran diplomacy fueling concerns despite the ceasefire extension.

At the time of writing, the price of Brent, the international benchmark, was up 2.8% at $108 per barrel, making it 10% more expensive in a week. In parallel, the WTI, the American benchmark, rose by 2.5% to around $96.7 per barrel.

This rebound comes after a second round of discussions between the US and Iran over the weekend failed to show progress. The White House decided not to send envoys to Pakistan for further negotiations as Tehran did not meet US demands, leaving uncertainty about the country’s direction.

“If they want, we can talk, but we won’t send anyone,” Trump said on Sunday, adding on social media earlier, “They just need to call!!!”

Meanwhile, ongoing Iranian missile activities force oil tankers to avoid the Strait of Hormuz, a critical shipping lane through which about a fifth of the world’s crude oil supply usually passes.

European stock markets traded cautiously on Monday, with the Euro Stoxx 50 and the Stoxx 600 hovering near equilibrium as investors assessed the latest developments in US-Iran negotiations.

The UK’s FTSE 100 and France’s CAC 40 edged slightly lower, while Germany’s DAX gained almost 0.2% and Italy’s FTSE MIB progressed by over 0.2%.

US futures were mostly in the red, with the tech-heavy Nasdaq remaining nearly stable. As investors closely monitor the situation in the Middle East, attention shifts to central banks this week, with key interest rate decisions expected from the ECB, the Fed, and the Bank of England.

The three central banks are likely to keep rates unchanged, but analysts will scrutinize every word for clues on the duration of this restrictive orientation as the global economy remains vulnerable due to the Iran conflict.

Ultimately, the trajectory of monetary policy for the remainder of the year continues to be influenced by geopolitical tensions beyond the control of central bank governors.

[CONTEXT: Oil prices increase due to US-Iran tensions and concerns about Middle East stability] [FACT CHECK: President Trump’s comments on US-Iran negotiations and Iranian missile activities]