Oil prices surge over 2pc

Oil prices climbed more than two per cent on Monday, pushing the Brent benchmark above USD 90 a barrel, according to Business Recorder. The rise followed a renewed clash in the US-Iran conflict, after Washington said it had struck Iranian rocket sites on a small island near the Strait of Hormuz, its first attacks on Iran in a month. Tehran answered by firing missiles at US military targets in Jordan.

President Donald Trump said the United States would respond to the Iranian strikes, and he will meet oil refining executives on Tuesday to address soaring domestic gas prices. The flare-up came as the conflict reached six months, with peace talks appearing stalled and the Hormuz waterway, which normally carries roughly a fifth of global oil and gas, still largely shut. Quintex Intel's Stephen Innes said the episode shows how fast geopolitical risk premiums can come back into the market.

Equity markets also weakened, with Wall Street and European indexes lower as investors reacted to the hawkish stance voiced by Federal Reserve chief Kevin Warsh. In his Jackson Hole speech on Friday, Warsh signalled that rate increases were likely and could come soon, which lifted bets on a hike at the September meeting, and the Dow closed 0.7 per cent lower on Monday. The dollar gave back earlier gains against its main rivals, while the 10-year US Treasury yield reached a level unseen since January 2025.