Oil prices jump, UK borrowing costs rise as US-Iran tensions escalate
10 reported
According to a single-source report from The Guardian, crude oil prices have reached their highest levels in four weeks following renewed hostilities between the United States and Iran. Brent crude rose $3.79 to $87.08 a barrel, a 4.55% increase, the highest since June 12 before a ceasefire. The US and Iran had signed a memorandum of understanding to end the conflict on June 17 and were negotiating a permanent peace deal. Donald Trump declared the ceasefire over last week but left the door to talks open. Iran said on Monday it was continuing talks with mediators from Qatar, Pakistan and Oman to prevent further escalation. UK government bond yields rose to their highest level since May, with the 10-year gilt yield rising 5 basis points to 5.02%, increasing government borrowing costs. Bank of England Governor Andrew Bailey told MPs the situation remained unstable and the ceasefire was fragile, adding that the "big issue" for the UK is slow economic growth.
What’s reported
Brent crude jumped $3.79 to $87.08 a barrel, a 4.55% increase, highest since June 12.
US West Texas Intermediate crude rose to a high of $81.25 a barrel, trading at $80.92, up 2.8%.
The US and Iran signed a memorandum of understanding to end the conflict on June 17.
Donald Trump declared the ceasefire over last week but left the door to talks open.
Iran said on Monday it was continuing talks with mediators from Qatar, Pakistan and Oman.
UK 10-year gilt yield rose 5 basis points to 5.02%, the highest since May.
Two-year gilt yield jumped 8 basis points to 4.45%, highest since May 19.
Financial markets fully priced in a quarter-point UK rate rise by September.
BP shares gained 3% and Shell shares rose 1.7% on the FTSE 100.
China’s car exports rose to a record 1.06 million cars in June, up 71.2% year-on-year.
Key figures
Donald Trump, US president
Andrew Bailey, Bank of England governor
Soni Kumari, analyst at ANZ bank
Victoria Scholar, head of investment at interactive investor
Andy Burnham, prime minister in waiting (UK)
Sources: The Guardian
