Donald Trump Strait of Hormuz blockade threat sends oil above $104 as ASX falls after stalled US-Iran talks

Benchmark oil prices surged in early Asian trade after US President Donald Trump said he would blockade the Strait of Hormuz to prevent any energy tankers from transiting the waterway bordered by Iran and Oman. The Australian share market opened down 0.5 per cent, with every sector lower except energy. Brent Crude futures for May delivery jumped 8.7 per cent to $US103.80 a barrel and US WTI oil rose 8 per cent to $US104.39 a barrel, after prices fell last week on the back of Iran and the US agreeing to a 10-point peace plan for two weeks. The move higher in oil also comes after talks between the US and Iran in Pakistan ended without a definite peace deal on Sunday. “Trump said he would implement a full naval blockade of the Strait of Hormuz, stopping the trickle of vessels, primarily from China, that have been traversing the strait,” said ANZ Bank’s economics team. “Iran responded by saying that the approach of any military vessels would be considered a breach of the ceasefire agreement. Markets are likely to react negatively today.” Wall Street futures pointed to heavy losses at the opening bell in New York. Gold prices fell 1.5 per cent to$US4676 an ounce and risk bellwether Bitcoin tumbled 3.5 per cent to $US70,725. On the S&P/ASX 200 the best performing stock was Karoon Energy, up 7 per cent to $2.13.