European markets close lower as oil price surges amid Middle East turmoil

In this article

• .SPIPSA
• EQNR-NO
• OXY
• TTE-FR
• BP.-GB
• XOM

Follow your favorite stocksCREATE FREE ACCOUNT

Vadimrysev | Istock | Getty Images

LONDON — European stocks closed sharply lower as traders tracked developments in the Middle East and a surge in oil prices.

The pan-European Stoxx 600 provisionally closed down around 0.7%, with major bourses and all sectors except for oil and gas selling off.

European investors were monitoring more turbulence in global markets on Monday as oil prices rose on Sunday to over $110 per barrel for the first time since 2022, when Russia invaded Ukraine.

West Texas Intermediate crude futures were last up 5% at $95.81 per barrel, while international benchmark Brent crude traded nearly 8% higher at $100 per barrel.

watch now

VIDEO4:4904:49

European stocks plunge to 2026 low as oil spikes

Squawk Box Europe

Yields in European government bonds rose sharply earlier as the war in Iran and surging oil prices drove concerns over higher inflation.

In the U.K., yields on 10-Year Gilts — the benchmark for U.K. government borrowing — were up 3 basis points to 4.664%. Yields on 2-Year Gilts were 13 basis points higher, reaching 4%, while 5-year Gilts were 5 basis points higher, at 4.175%. In Germany, 2-Year Bunds rose 1 basis point, paring earlier gains, pushing the cost of short-term borrowing to 2.333%.

The energy price surge comes after major Middle Eastern oil producers Kuwait, Iran and the UAE cut oil production following the closure of the Strait of Hormuz.

Birds fly near a boat in the Strait of Hormuz amid the U.S.-Israeli conflict with Iran, as seen from Musandam, Oman, March 2, 2026.

Amr Alfiky | Reuters

U.S. President Donald Trump posted on Truth Social on Sunday that a gain in “short term oil prices” was a “very small price to pay” for destroying Iran’s nuclear threat. “Only fools would think differently!” Trump added.

Amid the heavy selling, British multinational miner Anglo-American was 3.4% lower, tumbling to the bottom of the FTSE 100, while Rolls-Royce, the London-listed aerospace and defense giant, was down 2%.

Asia markets tumbled overnight and U.S. stocks plunged at the open amid fears that higher energy prices could dramatically slow the U.S. economy.

There are no major earnings or data releases from Europe on Monday.

Read more U.S.-Iran war news

• U.S. forces sink 16 Iranian minelayers as reports say Tehran is mining the Strait of Hormuz
• Iran sends millions of oil barrels to China through Strait of Hormuz even as war chokes the waterway
• Former Israeli Ambassador: Iran war won’t end in a few days
• Prediction markets face questions amid Iran war, nuclear detonation wagers
• Russia told Trump it has not shared intelligence with Iran during war, Witkoff says
• Oil retreats even after Energy Secretary wrongly claims Navy escorted tanker through Strait of Hormuz
• Strait of Hormuz will partially reopen in 2-3 weeks: David Roche
• The Iran war threatens LPG supply. India’s restaurants are in trouble
• Iran defends strikes on Gulf neighbors — but they say trust is broken
• Why China can withstand oil’s surge past $100 more easily than other countries
• Trump says oil price surge is a ‘small price to pay’ for defeating Iran
• PRO: Oil price surge could boost these Chinese stocks, Goldman says

Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.