European stock markets opened lower as optimism fades that the key Strait of Hormuz waterway could be opened swiftly.

The news that US had intercepted and seized an Iran-flagged cargo ship, together with Iran’s statement said on Saturday it was closing the strait again, have knocked hopes of a quick resolution to the situation.

The price of Brent crude oil jumped 5% to $95.29 a barrel as traders reacted to the latest news from the Gulf, reversing some of the falls seen on Friday when Iran had said the Strait of Hormuz would be "completely open" to commercial vessels for the remainder of the ceasefire.

The UK’s FTSE 100 share index fell 0.6%, Germany’s Dax dropped 1.6% and France’s Cac 40 index was down 1.3% on Monday morning.

"Hopes for an imminent resumption of trade, especially energy shipments, have evaporated," says Susannah Streeter, chief investment strategist at Wealth Club.

Source : BBC