FTSE 100 jumps as Strait of Hormuz fully open following ceasefire
The Iranian regime has reopened the Strait of Hormuz following a ceasefire in the Middle East between numerous warring nations.
Tehran’s foreign minister said on Friday afternoon: “In line with the ceasefire in Lebanon, the passage for all commercial vessels through Strait of Hormuz is declared completely open for the remaining period of ceasefire”.
Traffic has remained all but halted since the war broke out at the end of February leading to soaring prices. The narrow waterway, which sits off Iran’s coasts, sees around a fifth of the world’s oil supply flow through.
Stocks bounced on the news with the FTSE 100 sharply rising 0.5 per cent to 10,644.84p. Travel stocks across the board soared with Easyjet up eight per cent and On the Beach four per cent.
But oil majors, which had rallied on the tensions, took a hit. BP sank six per cent and Shell five per cent.
Brent crude prices – the international benchmark for oil – took a hit falling ten per cent to under the $90 mark.
Neil Wilson, Saxo UK Investor Strategist said: “That’s a massive shot in the arm for risk sentiment: Iran says the Strait of Hormuz is open to all commercial shipping during the Israel-Lebanon ceasefire…
“A good chance for fomoop (fear of missing out on peace) trades to ratchet up into the weekend, though watch for what the US says and consider even if Iran says it’s open, how many will get through?
Trump says US blockade continues
Reacting to the news President Donald Trump posted on Truth Social: “Iran has just announced that the Strait of Iran is fully open and ready for full passage. Thank you!”
It comes after a 10-day ceasefire between Israel and Israel has come into effect. Trump announced the agreement earlier today, where he said he had spoken to both Israeli prime minister Benjamin Netanyahu and Lebanese president Joseph Aoun, and invited both leaders “for meaningful talks”.
But Trump followed up his original post with another stating the US naval blockade “will remain in full force and effect as it pertains to Iran, only, until such time as our transaction with Iran is 100 per cent complete”.
He added the process should go “very quickly” with most points “already negotiated”.
Sir Keir Starmer is in France today to co-chair a meeting with allies regarding the strait.
Around 40 countries are expected at the meeting, where the Prime Minister is expected to said “focus on supporting the fragile ceasefire in the region and [in] ensuring shipping routes are reopened and secured through the Strait for the long term”.
Elsewhere today, Trump told reporters that the war in Iran is “going along swimmingly”, and added that it “should be ending pretty soon”.