Oil climbs, stock futures drop

Brent crude futures gained nearly 5% to $95.16 a barrel

Oil prices climbed and stock futures dropped on Monday as rising tension in the Middle East kept ​shipping in and out of the Gulf to a minimum, though traders held out hope for a ‌resolution and Asia’s stock markets moved toward record highs.

Brent crude futures gained nearly 5% to $95.16 a barrel. S&P 500 futures dropped almost 0.6% and European futures declined 1.1%. But equity benchmarks in Seoul, Taipei and Tokyo shrugged off risks to advance, with Taiwan’s shares hitting a record high and the ​other two not far behind.

Meanwhile, Iran has re-imposed its de facto closure of the Strait of Hormuz, though Kpler data showed ​that more than 20 vessels carrying oil products, metals, gas and fertiliser passed through on Saturday, the ⁠busiest day for the chokepoint since March 1.

The ceasefire in the Iran war, due to run until Tuesday, was in ​doubt after the U.S. seized an Iranian cargo ship and Iran vowed to retaliate.

The headlines look bad; it looks like ​there’s disagreement which has led to a little bit of re-escalation, said Damien Boey, portfolio strategist at Wilson Asset Management in Sydney.

But I think, ultimately, both sides want to be able to do a deal – that’s part of the reason why the market’s optimistic and not selling off too ​much, he said.

Hang Seng advanced 0.8%, Nikkei jumped 1% and South Korea’s KOSPI gained 1.4%.

One of the strongest notes of ​caution in markets on Monday came from Australia’s largest business lender, National Australia Bank, which flagged a $500 million impairment charge as it expects the ‌war to ⁠drive up bad debts.