Crude prices were climbing as investors turned their attention back to threats looming over oil facilities in the Middle East, despite a call from U.S. President Donald Trump for nations to help protect the Strait of Hormuz, a vital artery for global energy supplies.
The two main oil benchmark contracts have soared more than 40% this month to reach their highest level since 2022, after U.S. and Israeli strikes against Iran led Tehran to halt maritime traffic through the strait, cutting off a fifth of the world's oil supply in the largest disruption in history.
The Wall Street Journal reported that the Trump administration plans to announce, possibly as early as this week, that several countries have agreed to form a coalition to escort vessels through the Strait of Hormuz. However, Japan and Australia said on Monday they had no plans to send warships for such a purpose.
High oil prices have clouded the inflation outlook, which should lead most central banks to maintain a wait-and-see stance at this week's monetary policy meetings, and likely prompt some to raise rates.
Monetary policymakers from the United States, United Kingdom, Europe, Japan, Australia, Canada, Switzerland, and Sweden will hold their first full meetings since the start of the war, with energy prices looming large.
The Federal Reserve is widely expected to hold rates steady on Wednesday, and the probability of an easing in borrowing costs by June has dropped from 69% a month ago to just over 20%, according to IRPR, an LSEG monetary futures tool.
Investor focus will be on the tone of the statement and press conference, and whether the median projections in the "dot plot" rule out any further cuts for this year. The dot plot is a document reflecting where Fed members anonymously forecast interest rates will be in the coming years.
On the trade front, economic officials from the United States and China were scheduled to conclude talks in Paris on Monday, with potential areas of agreement on agriculture, critical minerals, and regulated trade, which could be addressed by Trump and Chinese President Xi Jinping in Beijing.
Elsewhere, the M&A landscape was heating up in Europe, with Italian bank Unicredit launching an unsolicited takeover bid for Germany's Commerzbank.
Against this backdrop, at 0802 GMT on Monday, the Spanish blue-chip IBEX 35 was down 15.40 points, or 0.09%, at 17,043.90 points, while the FTSE Eurofirst 300 index of major European stocks rose 0.16%.
In the banking sector, Santander lost 0.44%, BBVA fell 0.25%, Caixabank rose 0.14%, Sabadell gained 0.10%, Bankinter dropped 0.11%, and Unicaja Banco lost 0.08%.
Among major non-financial stocks, Telefónica fell 0.14%, Inditex rose 0.58%, Iberdrola dropped 0.61%, Cellnex fell 1.19%, and the oil company Repsol rose 0.35%.
(Reporting by Tomás Cobos; editing by Benjamín Mejías Valencia)
