FTSE 100 Live: Iran escalation and $93 oil set tone for cautious London open Proactive uses images sourced from Shutterstock
US threatens secondary sanctions against Iran’s trading partners
Hormuz negotiations break down without an agreement
Brent holds above $93 after climbing beyond $94
FTSE 100 futures little changed after Wall Street losses
7:15 am: Iran escalation returns oil and inflation risks to focus
The FTSE 100 faces a cautious start after the United States announced a sharp escalation in its economic campaign against Iran following the breakdown of negotiations over reopening the Strait of Hormuz.
President Donald Trump has threatened what he described as an “economic D-Day”, with measures expected to target Iranian oil sales, financial transactions and the networks used to circumvent existing restrictions.
US Treasury Secretary Scott Bessent said the next phase could include secondary sanctions against countries and companies that continue trading with Iran. Such measures could affect major buyers of Iranian oil, including China and India, and potentially widen the dispute beyond the Middle East. Associated Press
The escalation follows the failure of negotiations aimed at restoring shipping through the Strait of Hormuz, which handled roughly 20% of internationally traded oil before the conflict. The United Arab Emirates has also suspended trade with Iran following an alleged missile attack, which Tehran has denied.
Oil prices initially jumped more than 3%, taking Brent crude above $94 a barrel, before easing to around $93.37 early on Friday.
Elevated oil prices could support FTSE 100 heavyweights BP and Shell at the open. However, the wider implications are less favourable, with higher energy costs adding to inflation concerns and potentially weighing on airlines, retailers and other consumer-facing companies.
September FTSE 100 futures remained broadly unchanged at 10,784.5 shortly before 7:00am, while London’s cash index closed Thursday at 10,748.16.