Clear market uncertainty despite latest Trump attempt too soothe concerns

• UK wholesale gas prices rose over 6% and sterling fell from $1.33 to $1.32 against the dollar following Trump's statements, making dollar-priced oil even more expensive for Britain
• The Strait of Hormuz shipping disruption has lasted a month, blocking more than a fifth of global oil and LNG supplies, with food inflation expected to reach at least 9% by year-end
• Asian markets posted significant losses with Korea's Kospi down 4.5% and Japan's Nikkei falling 2.3%, while UK petrol and diesel prices jumped more in March than any previous single month

Market Summary: Trump Iran War Comments Fuel Uncertainty

Key Developments:

President Donald Trump's primetime address on April 2, 2026, claiming U.S. forces could exit Iran in "two to three weeks" while threatening strikes on Iranian electric plants has intensified market volatility rather than easing concerns.

Commodity & Currency Movements:

• Brent crude oil surged over 7% to $107.50/barrel after falling below $100 the previous day
• UK wholesale gas prices rose more than 6% following Trump's statements
• Sterling weakened from $1.33 to $1.32, and fell from €1.16 to €1.15, making dollar-priced commodities more expensive for UK buyers

Equity Market Impact:

• South Korea's Kospi index plunged 4.5%
• Japan's Nikkei fell 2.3%
• UK's FTSE 100 shed 0.6% after strong Wednesday gains

Core Issue:

Markets fear a 1970s-style energy crisis due to month-long disruptions in the Strait of Hormuz, which typically handles over 20% of global oil and LNG shipments. Iranian attacks on vessels and soaring insurance premiums have made passage too dangerous, causing supply bottlenecks and production shutdowns.

UK Economic Impact:

• Home heating oil prices remain double pre-war levels
• March saw the largest single-month jump in petrol and diesel prices, according to RAC
• Food and Drink Federation estimates food inflation will reach at least 9% by year-end

Context:

This marks Trump's latest failed attempt to calm markets, following unsuccessful initiatives including promised naval escorts through Hormuz, lifting Russian oil sanctions, and suggested seizure of Iran's Kharg Island oil terminal.