Oil Prices Slip As Investors Await US Economic Pressure Plan On Iran

Oil prices slipped on Monday after strong gains last week, while stock markets also faltered as investors awaited details of a US plan to impose massive economic pressure on Iran to end the war in the Middle East.

Attention was focused on US Treasury Secretary Scott Bessent, who was expected to hold a press conference later Monday to outline new measures against Tehran, as the conflict continues with no sign of an agreement to reopen the crucial Strait of Hormuz.

Bessent wrote in the Financial Times that Washington was launching the “single greatest financial offensive marshalled against an adversary,” describing it as an “economic D-Day.”

Both major crude contracts were around two per cent lower, although Brent crude remained above $92 a barrel after rising more than seven per cent last week.

“The US is changing tactics in its battle against Iran, and its fight to get oil flowing more freely from the region,” said Susannah Streeter, chief investment strategist at Wealth Club.

She said there could be some relief that the threats had shifted from military strikes to tougher sanctions, but added that there was little confidence that a peace deal would emerge soon.

In European trading, London edged slightly higher, while Frankfurt and Paris were broadly flat.

Asian markets came under renewed pressure, particularly technology stocks, as investors awaited earnings from Nvidia, a major indicator of the artificial intelligence sector’s strength.

Investors are looking for clues on whether the AI boom will continue to accelerate as the technology expands into more areas of the global economy.

South Korea’s technology-heavy Kospi fell more than three per cent, weighed down by a sharp decline in Samsung Electronics shares, while Tokyo and Shanghai also closed lower.

Hong Kong’s Hang Seng Index fell nearly two per cent despite fast-fashion retailer Shein announcing that its long-awaited market debut would take place in the Chinese financial hub on September 1.

The listing is expected to value Shein at close to $27 billion.

Chinese technology giant Alibaba also remained in focus after announcing plans on Sunday to issue $10.2 billion in new shares in Hong Kong to fund its artificial intelligence ambitions.

Markets are also watching this week’s annual gathering of central bankers, economists and finance chiefs in Jackson Hole, United States, where investors hope to gain greater clarity on US monetary policy.

The meeting comes after the US Treasury said it would buy back more of its own bonds to push down borrowing costs, following a surge in the 30-year yield to levels last seen in 2007, shortly before the global financial crisis.

Government bond yields have risen across several Western economies amid concerns over inflation and rising debt, while the United States reported last week that its federal debt had surpassed $40 trillion.

On currency markets, the Canadian dollar fell 0.5 per cent against the US dollar, extending its decline over the past month after Ottawa vowed to retaliate against new US tariffs.

As of around 10:15 GMT, Brent crude was down 1.7 per cent at $92.77 a barrel, while West Texas Intermediate fell 2.4 per cent to $85.01.

The FTSE 100 was up 0.2 per cent at 10,832.46 points, while the CAC 40 and DAX were broadly flat.

In Asia, Tokyo’s Nikkei 225 fell 0.7 per cent, Hong Kong’s Hang Seng dropped 1.9 per cent, and Shanghai’s Composite declined 0.6 per cent.

The dollar was trading at 159.19 yen, while the euro fell to $1.1664 and the pound slipped to $1.3631.