Crude prices slide over 1% as mediators unveil 60-day roadmap, while UK political turmoil sends pound tumbling and global stocks deliver mixed performance
Oil prices took a hit on Monday as optimism over US-Iran negotiations outweighed geopolitical jitters, with mediators announcing a “roadmap” toward a final agreement that could ease tensions in the energy-rich Gulf region.
Talks Finally Happen After False Start
The negotiations, which had been postponed Friday due to Israel-Hezbollah clashes, finally kicked off Sunday in Switzerland. US Vice President JD Vance and Iran’s Mohammad Bagher Ghalibaf led their respective teams, with Pakistan and Qatar acting as mediators.
Despite initial panic when Iran reportedly threatened to walk away over President Trump’s warning of further strikes on Hezbollah, the talks proceeded in what mediators described as “a positive and constructive atmosphere.”
Key Breakthroughs Announced
The two mediators revealed significant progress, including:
· Establishment of a “communication line” to prevent incidents in the strategic Strait of Hormuz
· Agreement on a 60-day roadmap toward a final deal
· Plans for immediate technical talks to address Tehran’s nuclear programme and reopen the vital waterway
Iranian Foreign Minister Abbas Araghchi confirmed on X that “mediation has delivered major progress to end the Lebanon War.”
Market Reaction: Oil Down, Stocks Mixed
Brent North Sea Crude tumbled 1.7% to $79.19 a barrel, while West Texas Intermediate slipped 0.6% to $75.37.
Stock markets delivered a mixed performance:
Asian markets:
· Tokyo’s Nikkei 225: UP 1.6% to 72,353.96
· Shanghai Composite: UP 1.8% to 4,163.10
· Seoul’s Kospi: UP 0.7% to 9,114.55
· Hong Kong’s Hang Seng: DOWN 0.4% to 23,822.25
European markets opened higher:
· London FTSE 100: UP 0.1% to 10,368.72
· Paris and Frankfurt also advanced
National Australia Bank’s Skye Masters sounded a cautious note: “Following the positive response last week to reports of a US-Iran ceasefire, markets are likely to open with a cautious tone to start the new week as it remains clear that the situation in the Middle East remains fragile.”
UK Political Crisis Deepens, Pound Slumps
The pound extended its losses after Thursday’s by-election victory for Labour’s Andy Burnham, which intensified speculation that embattled Prime Minister Keir Starmer will be forced out.
The Guardian reported that Starmer “is expected to announce on Monday that he will step down as prime minister after overwhelming pressure from Labour MPs to make way for Andy Burnham.”
Investors fear Burnham could introduce fresh spending plans that would balloon the UK’s already massive debt pile.
Currency movements:
· Euro/dollar: DOWN to $1.1457
· Pound/dollar: DOWN to $1.3210
· Dollar/yen: UP to 161.72 yen
