Oil Prices Tumble as US Treasury Secretary Signals Imminent Iran Deal; FTSE 100 Miners Rally
Key Takeaways
- •Brent crude fell more than four percent after US Treasury Secretary Scott Bessent signaled a potential deal with Iran to open the Strait of Hormuz within days.
- •The Strait of Hormuz facilitates roughly one-fifth of global oil consumption, making any disruption or resolution there significant for worldwide energy markets.
- •London-listed mining companies led the FTSE 100 higher, with Fresnillo reporting a 75 percent revenue jump to $3.4 billion and Glencore and Antofagasta each gaining over four percent.
- •Prologis confirmed a £14 billion takeover of FTSE 100-listed Segro, marking a major deal in the logistics real estate sector.
- •HSBC initiated a $1 billion share buyback after its profits exceeded analyst forecasts.
Oil prices fell sharply on Tuesday after US Treasury Secretary Scott Bessent said a deal over the Strait of Hormuz could be reached with Iran within days, sending Brent crude — the international benchmark — down more than four per cent.
"We're in talks with the Iranians and I think there is a chance we may have a deal today or tomorrow to open the strait," Bessent said in an interview on CNBC, adding that he believed an agreement could restore "free movement" to the critical oil shipping route.
The Strait of Hormuz is one of the world's most important energy chokepoints, with roughly a fifth of global oil consumption routinely passing through it. Any sustained disruption would affect shipments from major Gulf producers including Saudi Arabia, the UAE, Kuwait, and Iraq, making the prospect of a deal a significant signal for global energy supply chains.
Oil prices had already drifted lower the previous day after President Donald Trump called off planned strikes on Iran. However, progress toward a finalised peace deal has continued to stall as the President clashes with Iran's leadership.
FTSE 100 Lifted by Mining Sector Rally
The UK's blue-chip FTSE 100 index extended its early gains on Tuesday, driven by a strong performance from London-listed mining companies.
Fresnillo reported a 75 per cent jump in revenue to $3.4bn (£2.5bn), lifting the broader sector. Glencore and Antofagasta both gained more than four per cent in early trading, while Anglo American rose 3.5 per cent and Rio Tinto climbed 2.5 per cent.
Tuesday's mining rally builds on a robust showing for the sector last week, when Rio Tinto posted a 43 per cent jump in profit and Glencore said it was on track for a record-breaking performance in its trading division. London-listed miners have been among the chief beneficiaries of sustained strength across industrial and precious metals markets this year, and the latest earnings add to evidence that elevated commodity prices are translating into stronger bottom-line results for the sector's biggest players.
The FTSE 100 had closed 10 points lower on Monday at 10,857, recovering from a shaky open to post afternoon gains before slipping in late trading.
Other Key Developments
- Prologis confirms £14bn takeover of FTSE 100 Segro
- HSBC kicks off $1bn share buyback after profit exceeds forecasts
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