# Stock markets tumble further as oil prices soar above 100 dollars a barrel

By Dan Coatsworth — 2026-03-09

Dan Coatsworth, head of markets at AJ Bell, said: “The Iran conflict intensified over the weekend and oil briefly going above $115 a barrel has caused another bout of selling on financial markets.

“Tipping over the $100 a barrel level has major implications from a psychological and economical perspective.

“It significantly raises the chances of a sharp jump in inflation and interest rates shifting to a completely different path than the market had priced in only two weeks ago.

“Markets are now pointing towards a situation where UK interest rates could remain level for the rest of the year and potentially go up in 2027.

“That is radically different from recent expectations of more cuts this year.

“Investors are now weighing up the prospect of the Iran conflict lasting longer than they previously thought.

“Risk appetite has evaporated as investors lock in profits on areas of the market that have served them well in recent months and years, such as shares in Rolls-Royce and Lloyds, and gold.

“The precious metal was also dragged down by a strengthening US dollar which makes gold more expensive for buyers in other currencies.

“The FTSE 100 fell 1.2 per cent to 10,160, with only a handful of stocks in positive territory including Shell and BP as two beneficiaries of the sharp rise in the oil price. Their earnings could soar in the near-term.

“One might have expected all types of commodity producers to be in demand if inflation picks up.

“When inflation goes up, investors often seek exposure to hard assets as they tend to retain value better than financial assets in such an environment.

“However, miners were among the biggest losers on the market on Monday.

“The spike in oil prices means mining companies face a sharp rise in costs to run their operations.

“There is also increased uncertainty around global economic activity because the Iran conflict puts a question mark over demand levels for metals and minerals near-term.

“Investors often turn to defensive-style industries in the face of uncertainty, such as grocers and tobacco producers.

“There are elements of that trend now at play, but these stocks are only relative winners, not absolute ones.

“For example, Imperial Brands was down 0.2 per cent which is nowhere near as bad as the broader market, but still in negative territory.

“While Tesco fared better with a 0.2 per cent rise, Sainsbury’s was down 1.1 per cent.

“Events in Iran are moving so fast that many investors might simply want to sit on the sidelines for now.”

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