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FTSE 100 set to rise as oil prices fall amid US sanctions threat

The FTSE 100 is projected to open higher today, following a 0.4 per cent gain on Monday. This comes as Brent crude oil prices dropped over two per cent.

  • The FTSE 100 closed 0.4 per cent higher at 10,854.32 on Monday.
  • Brent crude oil prices fell more than two per cent to below $92 per barrel on Monday.
  • US Treasury Secretary Scott Bessent threatened new economic sanctions against Iran and its trading partners.

The FTSE 100 is anticipated to edge up on Tuesday morning, according to futures from investment platform IG. This follows the blue-chip index closing 0.4 per cent higher at 10,854.32 on Monday.

The mid-cap FTSE 250 saw a slight decline, finishing at 24,717.48, while the small-cap AIM All-Share increased by 0.3 per cent to 814.04. Diageo, LSEG, and Airtel Africa were among the top large-cap risers, each gaining approximately three per cent, while BP experienced a nearly three per cent loss.

Investors are currently assessing the implications of US Treasury Secretary Scott Bessent's recent press conference. Bessent threatened new economic sanctions against Iran and countries that do not cut ties with it. Despite earlier promises of an "economic D-Day," no major new penalties were enacted immediately. Instead, the Trump administration expanded the definition of "Iran-related conduct" that could be subject to future sanctions.

Susannah Streeter, Wealth Club's chief investment strategist, noted that the US is altering its approach in its efforts to increase oil flow from the region, with sanctions being the latest tool. The price of Brent crude, the international oil benchmark, dropped over two per cent on Monday, falling to just under $92 per barrel.

Why this matters: The threat of US sanctions against Iran and its trading partners could influence global oil supply and prices, impacting energy markets.

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