Live updates: Iran war and Trump news, Khamenei’s son named supreme leader as oil price soars past $100 a barrel

European stock markets and US futures tumbled Monday, as soaring oil prices highlighted the growing economic fallout from the war with Iran.

Brent crude, the global oil benchmark, neared $120 a barrel early Monday before paring some of those gains to trade at around $103 a barrel — a level not seen since Russia’s 2022 Ukraine invasion. Prices are up more than 40% since February 27, the day before the United States and Israel attacked Iran.

WTI, the US benchmark, surged 10% Monday to $100 a barrel.

The STOXX Europe 600, an index of the region’s most valuable companies, fell around 1.5% to its lowest level since December. Stock markets in Paris, Frankfurt, Zurich and London also fell. US futures, meanwhile, pointed to a lower open.

“Clearly there are fears of a global economic slowdown and inflation crisis, which is roiling global markets after a weekend of further escalation in the Middle East war,” Neil Wilson, a strategist at UK trading platform Saxo Markets, wrote in a note.

Strikes on vital energy infrastructure in the region, including by Israel and Iran, have intensified fears of a global oil supply crisis. Iran’s decision to appoint Mojtaba Khamenei as its next supreme leader is also worrying investors. Khamenei is the the son of former leader, Ali Khamenei, who was killed in the first wave of US and Israeli strikes.

“It’s a sign of continuation of Iran’s hardline approach and indicates that the war will be more prolonged than financial markets had assumed last week,” Wilson said. “Complacency has been replaced by a degree of panic because the market is now pricing in a more sustained hit to energy and trade flows.

Surging oil prices will add to inflation pressures globally. Fears of an inflationary shock are sending government bond yields higher, because rising consumer prices will likely lead central banks to pause interest rate cuts or even raise rates.

The yield on UK two-year government bonds, used to set interest rates on mortgages, has jumped in the past week and now stands at nearly 4%, the highest level since October.

Olesya Dmitracova contributed reporting.