Brent slips below 110 dollars on hopes for Iran diplomacy as investors await the US vote
Oil loses more than 3 percent after reports that Trump wants to try the diplomatic route first; European stock markets and the Bel20 start the week with small losses.
Oil prices fell by more than 3 percent on Monday morning. A barrel of Brent dropped below the 110-dollar mark, while the US benchmark WTI traded at around 100 dollars, La Libre and Business AM report. According to La Libre, the market is mainly reacting to a report by the US news site Axios about a conversation between President Donald Trump and Israeli Prime Minister Benjamin Netanyahu: Trump reportedly wants to try a diplomatic solution first, while Israel wants to resume strikes on Iran right after Tuesday's midterm elections. Secretary of State Marco Rubio already said on Saturday that no decision had been taken.
Market watchers also describe the fall as a technical correction after the strong rise in October, when oil hit a six-month high, Business AM reports. Some analysts expect prices not to rise much beyond around 120 dollars even if attacks resume, because oil shipments through the Strait of Hormuz and alternative routes are still at around 80 percent of pre-war levels. OPEC+ kept its production quotas for December unchanged.
European stock markets began the week cautiously. At around 9 am London was down 0.29 percent and Paris 0.16 percent, while Frankfurt was almost flat, La Libre reports. The Bel20 was 0.16 percent lower at 5,831.60 points. Trends points out that the Brussels index still gained more than 4 percent in October. According to Trends, financial markets stayed calm on the news of the Belgian government crisis.
On Wall Street, the Nasdaq closed 2.84 percent lower on Friday and the S&P 500 1.83 percent, after a 29 percent plunge in chipmaker Intel and doubts about the returns on huge AI investments. A Swissquote analyst quoted by La Libre does not rule out investors continuing to shift money towards cheaper, less tech-heavy markets such as Europe. The elections could cause extra volatility in the coming days. Figures from S&P Global on Monday also showed that eurozone manufacturing still grew in October, if slightly more slowly, with a purchasing managers' index of 52.7, Trends reports.