Finance
Morning Bid: It's a Sad Strait of Affairs as Oil Soars
Published by Global Banking & Finance Review®
Posted on March 30, 2026
3 min readLast updated: March 30, 2026
Add as preferred source on GoogleGlobal Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on March 30, 2026
3 min readLast updated: March 30, 2026
Add as preferred source on GoogleBrent crude has surged, nearing a record monthly gain in March, amid heightened geopolitical tensions around Hormuz and Bab el‑Mandeb. Escalating Middle East conflict, troop buildups, and shipping threats are pushing oil futures higher and fueling inflation pressures in Europe.
March 30 (Reuters) - A look at the day ahead in European and global markets from Wayne Cole.
It's been a sea of red in Asian stock markets as Brent cleared $115 right from the off. It's now up roughly 59% in March, which would be the biggest month on record. Bigger even than when Iraq invaded Kuwait in 1990.
The headlines have not been helpful, with Pakistan trying to host peace talks but would-be U.S. and Iranian guests seemingly reluctant to RSVP. Attacks have continued across the Gulf and widened to the south as Yemen's Houthis launched strikes on Israel.
That was a worrying development as the Houthis could try to restrict shipping through the Bab el-Mandeb in the Red Sea, which is the other major choke point in the Middle East oil trade alongside the Strait of Hormuz.
As for the Strait, President Trump told the Financial Times that Iran had agreed to let through another 20 "big boats", presumably tankers, as a concession. That would also seem to be a tacit recognition that Iran controls the Strait.
Then again, Trump also said he wants to "take the oil in Iran" and might use U.S. forces to seize Kharg Island in the Persian Gulf, Iran's main oil exporting terminal.
He went on to say that talks with Iran were going on directly and indirectly, were going extremely well and could reach a deal soon, or might not.
Meanwhile, the U.S. build-up goes on, with various reports that more than 50,000 troops are in the region including more special forces.
All of which suggests the conflict could run for some time yet and the risks lean toward escalation, dealing more damage down the supply chain and lengthening the time for it to return to anything like normal once, if, the Strait re-opens. That is one reason why Brent futures are above $100 out to July, and December is up at $85 a barrel.
That's bad news for inflation and will show up starkly in March German preliminary CPI due later Monday, and EU CPI on Tuesday. The hawks at the ECB are already clawing for a rate hike, and markets imply a 58% chance of an April move.
Futures have given up on a Fed easing this year, which Fed Chair Powell may have something to say about at a Harvard event later today. It will also be front of mind for Kevin Warsh, the proposed replacement for Powell, with the Senate Banking Committee planning to hold a hearing on Warsh's nomination as soon as the week of April 13.
Key developments that could influence markets on Monday:
(By Wayne Cole; Editing by Sonali Paul)
Brent oil prices have surged due to escalating conflict in the Middle East, disruptions in major shipping straits, and attacks impacting supply routes.
The Strait of Hormuz is a key chokepoint for global oil trade. Disruptions or control in this region can significantly impact oil supply and prices.
Higher oil prices are expected to drive inflation, as seen in the upcoming preliminary CPI data for Germany and the EU.
With rising oil prices, central banks like the ECB are leaning toward rate hikes to combat inflation, while U.S. rate policy is also under scrutiny.
Key events include German CPI, EU economic data, Fed Chair Powell's remarks, and G7 finance and energy ministers' virtual meeting.
Explore more articles in the Finance category
