Global oil prices have jumped after U.S. President Donald Trump said its navy had intercepted and seized an Iran-flagged cargo ship.
The Brent crude benchmark oil price rose by more than 4% to $94.20 (£69.60) a barrel, reversing a fall on Friday when Iran said the Strait of Hormuz would be completely open to commercial vessels during a ceasefire.
On Saturday, Iran announced it was closing the strait again, threatening to target any ship that approached it.
The Strait of Hormuz is crucial as it facilitates around 20% of global oil and liquefied natural gas traffic.
Energy markets have reflected significant volatility since military actions began in February and Iran retaliated with threats to maritime security in the strait.
Trump mentioned that his representatives would be in Pakistan for negotiations, but Iranian media stated that Tehran had no immediate plans to engage in talks, leaving its position ambiguous.
Market analysts reported a sense of fatigue, indicating that the oil markets may be responding more to media updates from the U.S. and Iran instead of the actual situation at sea.
As the Strait of Hormuz remains closed following the Islamic Revolution Guard Corps' announcement to cease temporary openings, the conflict and subsequent U.S. blockade continue to create uncertainty in oil supply and prices.
In terms of general market performance, U.S. stock markets showed mixed reactions, with the Dow Jones remaining flat while European markets faced declines. Meanwhile, Asian markets reported earlier gains.
The ongoing Iran conflict has resulted in a global energy crisis, pushing up fuel prices and causing shortages in various countries, especially in Asia where reliance on the strait is significant.
