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Deal to reopen strait of Hormuz could come 'today or tomorrow', Bessent says
Oil prices are now falling again after the US treasury secretary Scott Bessent said that a deal could be struck “today or tomorrow” to reopen the strait of Hormuz.
Speaking to CNBC, Bessent said:
We are in talks with the Iranians, and I think there is a chance we may have a deal today or tomorrow to open the strait and move towards a more normalised position in this conflict.
Brent crude, which had been rising earlier today, is now down 3.4% to $80.88 a barrel.
Key events
Investors are waiting with bated breath ahead of the market open in the US, which closed yesterday within touching distance of a new record high.
Futures for the S&P 500 are up 0.3%, in a sign that the US market is ready to continue its tech-led rally. Shares in Palantir are already up 16% in pre-market trading after it raised its forecasts, while Caterpillar is up nearly 12% in pre-market.
It is a busy day for earnings later too, with SpaceX and Advanced Micro Devices both due to report today.
Global oil inventories low, Aramco warns
Saudi Aramco, the world’s top oil exporter, has warned that global oil inventories are low due to disruption triggered by the US-Israeli war with Iran and that refineries around the world are “stretched heavily”.
CEO Amin Nasser told reporters in a call today that the world has lost more than 2.6bn barrels of oil since the war began in February. The lost supply is equivalent to nearly a month of normal global crude production.
He said:
If the strait were to open today, it would take up to 18 months at an average rate of 2.1 million barrels a day to replenish depleted inventories.
He added:
The global refining system is stretched heavily as refineries are operating at near maximum utilisation rates.
This has clearly left the system with little shock absorbers or buffers.
…If refineries were to suffer any major unplanned or prolonged shutdown, the global energy supply system could face more severe pressure.
UK's mid-cap FTSE 250 hits record high
The UK’s mid-cap FTSE 250 stock index has just hit a record high, beating its last peak from 2021.
The index, which has a much stronger domestic focus compared with the bigger FTSE 100, is up 0.7% today. Its best performer today is Travis Perkins – its shares have shot up almost 20% today after the building materials supplier reported higher first-half profit, despite a subdued construction market in the UK.
Bessent added in his interview with CNBC that the Trump administration will do “whatever it takes” to support Japan’s effort to stabilise its currency.
Tokyo and Washington confirmed on Monday that they had carried out a rare joint currency intervention late last week, after the yen had weakened to a 40-year low of almost ¥164 to the dollar.
Bessent said:
We will do whatever it takes to support them in a way that helps the American economy, the American taxpayer.
When asked whether Iran would be allowed to charge a toll for passage via the strait of Hormuz, Bessent said the deal would allow for “freedom of movement”, without providing any specific detail.
He said:
It would be freedom of movement. Even though things are still a little dicey there over the past few days, we saw quite a few ships coming out even now.
He added that he expects oil prices to fall further when the strait of Hormuz opens.
There are hundreds if not thousands of ships sitting in there and waiting to go out.
…It’s not just energy. It’s fertiliser, it’s refined products, it is the various industrial gases. We could see a big relief trade as those prices go down.
Deal to reopen strait of Hormuz could come 'today or tomorrow', Bessent says
Oil prices are now falling again after the US treasury secretary Scott Bessent said that a deal could be struck “today or tomorrow” to reopen the strait of Hormuz.
Speaking to CNBC, Bessent said:
We are in talks with the Iranians, and I think there is a chance we may have a deal today or tomorrow to open the strait and move towards a more normalised position in this conflict.
Brent crude, which had been rising earlier today, is now down 3.4% to $80.88 a barrel.
Gwyn Topham
Gatwick airport is to start development of its second runway after campaigners lost a legal challenge to the plans.
The court of appeal on Tuesday dismissed a bid by local campaign groups to challenge an earlier igh Court ruling that the scheme could proceed.
The £2.2bn project, approved by the transport secretary, Heidi Alexander, in September, will allow about 100,000 more flights a year to use Britain’s second busiest airport.
Pierre-Hugues Schmit, chief executive of Gatwick, said the airport was :
“very pleased that this ruling brings to an end an eight-year planning and legal process which has carefully tested and scrutinised every aspect of our expansion plans on multiple occasions.”
The plans will see the West Sussex airport slightly reposition its emergency runway and use it routinely for short-haul passenger aircraft. It is currently among the busiest single-runway airports in the world, but hopes to have the second runway in operation as early as 2030.
Graeme Wearden
Streaming service Spotify has forecast weaker-than-expected profits in the next quarter, despite hitting a milestone for premium subscribers.
Spotify says it has become the first audio streaming service to reach 300 million Premium Subscribers in the second quarter of this year, up 9%, and slightly more than it had forecast.
But, the company forecast operating income of €670m in July-September, which Reuters flags is below analysts’ average estimates of €677.8m.
Operating income in April-June beat forecasts, though, coming in at €655m.
Alex Norström, co-CEO, says:
“We have a scale that few companies in history have reached, a business that is healthy and compounding, and opportunities only we are positioned to pursue.
Spotify lives across your whole day — the commute, the workout, studying, gaming, the dinner table, and sleep. At our scale, that is rare…Our position gives us an opportunity space as wide as our users want it to be.”
Shares in Spotify are down 4.4% in pre-market trading in New York.
Caterpillar sales boosted by data centre demand
Graeme Wearden
Construction equipment maker Caterpillar is continuing to benefit from the AI boom, cheering Wall Street.
Caterpillar has reported a jump in sales and profits in the second quarter of the year, led by its power equipment business which sells equipment to data centres.
The power generation division reported higher sales of “large reciprocating engines” and in turbines and turbine-related services, primarily in data centre applications, Caterpillar reported.
Shares in the company are up 9% in pre-market trading, having fallen by nearly a quarter during July as investors had retreated from AI-linked stocks.
Caterpillar chairman and CEO Joe Creed says:
“This is the first time in company history that we have generated over $20 billion in sales and revenues in a single quarter.
“This milestone underscores both the essential work our customers do every day and the dedication of Caterpillar employees worldwide to solving our customers’ toughest challenges. Strong order rates and a growing backlog reflect broadening momentum across all three of our primary segments.”
Oil price rises as uncertainty grows over US-Iran talks
The oil price is rising again today (after a sell-off yesterday) amid renewed uncertainty over US-Iran talks and reports that a cargo vessel was struck by an unidentified projectile near the strait of Hormuz off Oman’s coast.
Donald Trump said on Monday that talks were under way and Iran faced a “last chance” to reach a deal, while Iranian officials insisted no negotiations with the United States were taking place.
Iran has said its only talks are with Oman about the strait of Hormuz and that no major meetings are planned this week.
It follows a weekend in which Trump said he decided to cancel what he described as “massive attacks” on Iran – repeating a pattern in which he theatens major military action and then steps back.
Traffic is still trickling through the strait of Hormuz, with data from Kpler suggesting that three tankers and three bulk carriers were among the six vessels transiting the channel on Monday, down from seven the previous day.
Metro Bank is however one of the worst performers across the FTSE 350 this morning, with its shares down 9.2%.
Travis Perkins is at the top of the list, with its shares up 17.8% after the building materials supplier reported higher first-half profit, despite a subdued construction market in the UK.
Metro Bank reports bumper profits
Kalyeena Makortoff
Metro Bank has followed its big four competitors in reporting bumper profits for the first half of the year.
The challenger bank reported a 38% jump in pre-tax profits to £60.7m over the first six months of 2026, following a jump in corporate, SME and specialist mortgage lending, as Metro tries to corner “underserved markets” to boost profits.
Specialist mortgage lending alone - which include bigger loans to professionals like doctors and architects, and lending to borrowers who might have minor blips on their credit records - surged 73% year-on-year to £2.2bn.
It comes as the bank continues to shift out of run-of-the mill lending as part of a turnaround plan that followed its near collapse in 2023.
While the strong surge in profits will add weight to calls for a UK windfall tax, Metro would likely escape proposals put forward by campaign group Positive Money, which is calling for a levy on net interest income worth more than £800m per year.
Metro Bank reported around £241.5m in underlying net interest income for the first six months of the year, and if repeated, would keep its full year figure below campaigner’s thresholds.
Brent crude is extending its gains this morning, with the international benchmark for oil prices now up 2.7% to $86.12 a barrel.
Meanwhile UK gilts, which are sensitive to higher oil prices, are underperforming their European peers – the yield on the 10-year is up by more than 3 basis points to 4.993%.
