European Markets Set to Slump as Middle East Tensions Push Oil Prices Above $110

European stock markets are expected to open sharply lower on Monday as escalating tensions in the Middle East push global oil prices higher and shake investor confidence. Market analysts say traders are closely monitoring developments in the region, with energy prices surging and fears growing that the turmoil could ripple across global financial markets.

According to early market data, the FTSE 100 in the United Kingdom is projected to open about 0.9% lower. Germany’s DAX could fall by 2.67%, while France’s CAC 40 is expected to drop 2.3%. Italy’s FTSE MIB may decline by roughly 2.7%, reflecting growing uncertainty among investors at the start of the trading week.

The market jitters come after oil prices surged past $110 per barrel on Sunday for the first time since the Russian invasion of Ukraine. The spike followed production cuts by major Middle Eastern oil producers including Kuwait, Iran, and the United Arab Emirates after the strategic Strait of Hormuz was closed, a key global shipping route for oil.

Political reactions have also fueled the global debate. Donald Trump said on social media that a temporary rise in oil prices was “a very small price to pay” for eliminating what he described as Iran’s nuclear threat, suggesting that the geopolitical confrontation could have broader economic consequences.

Asian markets fell overnight, and U.S. stock futures also pointed to heavy losses as the week begins. Investors worry that higher energy costs could weigh heavily on economic growth, particularly in the United States. Meanwhile, Iran’s state media reported that Mojtaba Khamenei has been named the country’s new Supreme Leader, a development that adds another layer of uncertainty to an already tense geopolitical landscape.

source: cnbc