FTSE 100 Records Best Weekly Gain Since 2008 Despite Oil Price Surge and Middle East Tensions

Britain’s blue-chip share index achieved its highest weekly points gain since 2008, overcoming a sharp rise in oil prices and escalating concerns over the Middle East conflict. The FTSE 100 closed 71.50 points higher at 10,436.29 on Thursday, marking a 0.7 per cent daily increase and a substantial 4.7 per cent gain across the shortened week before the Easter break.

Brent crude, the global benchmark, surged 7.8 per cent to USD 109.03 a barrel on Thursday following renewed tensions between the United States and Iran. President Trump stated that American attacks on Iran would continue until the regime’s nuclear capabilities were reduced to Stone Age levels. Over the past four days, the oil price has climbed 3.5 per cent, whilst the year-to-date increase now stands at a striking 79.2 per cent.

Mid-week developments had initially suggested a potential de-escalation. Reports emerged on Wednesday indicating the Trump administration might be willing to end the conflict without insisting on a full reopening of the Strait of Hormuz, prompting a strong rally on Wall Street. However, the situation remained fluid throughout Thursday’s trading session.

European equity markets, which had opened in negative territory, began to shift during the early afternoon following reports that Iran’s foreign ministry was drafting a protocol with Oman for traffic through the Strait of Hormuz. This strategic chokepoint controls approximately 20 per cent of global oil and liquefied natural gas trade flows. Britain confirmed that roughly 40 countries were discussing joint action to reopen the strait, with officials emphasising the need to prevent Iran from holding the global economy hostage.

Kim Forrest, chief investment officer at Bokeh Capital Partners, observed that traders were keen to see the Strait of Hormuz reopened, noting that the United Kingdom appeared to be leading diplomatic efforts. The shift in market sentiment reflected growing optimism around potential resolution pathways.

Broader European markets also recorded strong weekly performances despite mixed daily results. Germany’s Dax finished the week up 3.9 per cent, whilst the CAC 40 in Paris gained 3.4 per cent. The Stoxx Europe 600 index of the continent’s largest publicly traded companies posted a weekly rise of 3.7 per cent, demonstrating widespread investor confidence despite ongoing geopolitical uncertainties.

The International Energy Agency’s head warned that supply disruptions would begin affecting Europe’s economy this month. The agency characterised the strait’s closure as the largest supply disruption in the history of the global oil market. European economies had previously been shielded by cargoes contracted before hostilities commenced, but this buffer was now diminishing.

American indices reflected similar patterns, opening in negative territory before paring losses by lunchtime on hopes that the Oman protocol might facilitate the strait’s reopening. Adam Turnquist, chief technical strategist at LPL Financial, identified the primary concern for investors as the risk that a prolonged conflict would create sustained pressures on inflation, global growth, interest rates and equity valuations.

The S&P 500 rose 0.1 per cent to 6,582.69, whilst the Nasdaq advanced 0.2 per cent to 21,879. The Dow Jones industrial average declined marginally by 0.1 per cent to 46,504.67, reflecting cautious optimism tempered by ongoing geopolitical risks.