JAKARTA - Oil prices have risen again after tensions between the United States and Iran have heated up. Markets are starting to doubt that shipping in the Strait of Hormuz can quickly normalize.
Al Jazeera, quoted Monday, June 29, reported that Brent, the main benchmark for world oil prices, rose about 0.9 percent on Monday. The increase came after the US and Iran retaliated at the weekend to shake up the vital energy line.
Brent futures for August delivery were at $73.21 a barrel by 0330 GMT, up 127 cents from a day earlier when the United States and Israel launched a war against Iran on February 28.
Fabien Yip, IG market analyst in Sydney, said the rise in Brent showed the market was too quick to believe in the optimism of the ceasefire.
"Oil almost wiped out the entire war premium, even though the memorandum of understanding did not contain details of enforcement and attacks were still ongoing," Yip told Al Jazeera.
According to Yip, the attack on a commercial vessel on Thursday was a reminder that the risk had not disappeared. The retaliatory attack at the weekend further strengthened market concerns.
Anxiety was also felt on the Asian exchange. The stock market moved differently on Monday morning. Tokyo and Seoul weakened, while Hong Kong and Taipei strengthened.
Japan's Nikkei 225 fell 0.7 percent. South Korea's Kospi weakened 1.9 percent. AI-related stocks in Japan and Korea were among the hardest hit.
SoftBank Group fell about 5 percent. Advantest, a semiconductor test equipment maker, fell 3.7 percent. In South Korea, Samsung Electronics and SK Hynix fell about 5 percent and 4 percent, respectively.
In contrast, the Hang Seng Hong Kong rose 2.2 percent, while Taiwan's Taiex gained 1.4 percent.
Yip said selling pressure was also triggered by profit-taking at the end of the quarter. Investors secured profits after a big rally. The Kospi is up about 95 percent this year, while the Nikkei is up 37 percent.
However, a bigger concern is whether the AI euphoria can really turn into sustained profit growth. Markets are starting to ask if margin pressures are coming sooner than expected.
The US Central Command earlier announced attacks on Iran on Friday and Saturday. Washington called the move a response to Iran's attacks on two commercial vessels in the Strait of Hormuz.
The Strait of Hormuz is one of the world's most important energy routes. In peacetime, about a fifth of the world's oil and liquefied natural gas trade passes through the region.
Iran retaliated by launching missiles and drones at US military assets in Bahrain and Kuwait.
A number of media outlets reported that Washington and Tehran agreed to stop the attacks and continue negotiations to end the war. The report quoted unnamed US officials.
Axios also reported that the two sides would hold talks in Doha, Qatar, on Tuesday. Iran has not commented on the reports of the cessation of hostilities or the negotiation plan.
US President Donald Trump and Iranian President Masoud Pezeshkian signed a memorandum of understanding to end the war on June 17. However, the deal continues to be pressured by new attacks and differences in interpretation of the contents of the document.
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