Stocks drop, oil rises as Hormuz hopes fade

Asian stocks mostly fell and oil prices extended gains on Tuesday as hopes for a reopening of the Strait of Hormuz fade amid expectations the Federal Reserve will hike interest rates again next month. Hopes for an easing of Middle East tensions were dashed at the weekend when Donald Trump rejected Iran's offer for a seven-day truce. While he said talks would resume this week, that was unable to lift the gloom on market floors, with traders contemplating further rises in inflation that will force the Fed to tighten monetary policy more. The US president on Monday denied a report by the news outlet Axios that he offered Iran sanctions relief and the release of frozen funds, as the Middle East war drags on."Axios just released a story that 'Trump' offered Sanctions Relief and Frozen Funds to Iran. This is untrue. I offered them NOTHING!," Trump said on his Truth Social platform. The story said Trump "is willing to give Iran sanctions relief and release Iranian frozen funds in return for concrete Iranian steps regarding the nuclear program", quoting unnamed US officials. The 80-year-old Republican called the story "a HOAX" and said the news site should withdraw it. But Iran's state broadcaster said the country's Foreign Minister, Abbas Araghchi, will meet Qatari representatives. The talks are expected to focus on "messages exchanged with the United States through intermediaries... particularly regarding the conditions set by Iran for the reopening of the Strait of Hormuz". However, Tehran officials have privately expressed pessimism about making a deal to reopen Hormuz before November's US midterm elections, Bloomberg reported sources as saying. The waterway is key to the world's oil and gas deliveries and is now central to the conflict between the US and Iran, particularly with the Iran-backed Houthis seizing Yemen's entire Red Sea coast, including the Bab Al Mandab Strait, another vital shipping lane."Our expectations remain that the conflict will be with markets for the foreseeable future and the global economy will continue adjusting to the realities of the supply disruptions," said Ian Lyngen at BMO Capital Markets. Both main crude contracts rose more than one percent Tuesday, and the lack of any progress in ending the conflict continues to put upward pressure on fuel costs. Average UK diesel prices have hit a record high, according to the RAC motoring organisation. Equity markets struggled following a day in the red for all three main indexes on Wall Street. Tokyo, Seoul, Hong Kong, Mumbai, Singapore, Taipei, Wellington, Jakarta and Manila were all down, but Shanghai and Sydney rose. Agence France-Presse

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Gulf Today - Business · Business News

Published

29th September 2026

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gulftoday.ae

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