Plumes of smoke rise after debris from an intercepted Iranian drone struck an oil facility, according to authorities, in Fujairah, United Arab Emirates, Saturday, March 14, 2026. (AP Photo/Altaf Qadri)
Oil prices hovered around $100 a barrel Monday and stocks fluctuated as the Iran war moved into a third week with both sides showing no sign of backing down and diplomats trying to ensure safe passage for tankers through the crucial Strait of Hormuz.
Crude shot up in the opening minutes after the U.S. president said at the weekend that forces struck military targets on Kharg Island, a scrubby stretch of land in the Gulf that handles almost all of Iran's oil exports.
He also warned attacks could expand to energy infrastructure if the Islamic republic interferes with transit through Hormuz, which has been effectively closed since the U.S.-Israel operations began on February 28.
Iran's Fars news agency reported soon after that no oil infrastructure was damaged in strikes.
Trump urged other countries to send warships to keep the waterway open but offered no specifics or commitments from the U.S. side, saying he hoped China, France, Japan, South Korea and the UK would take part.
He later wrote Saturday in a Truth Social post: "The Countries of the World that receive Oil through the Hormuz Strait must take care of that passage, and we will help — A LOT!
"This should have always been a team effort, and now it will be."
However, Japan said Monday it was "not at the moment considering issuing a maritime security operation", while Australia announced it would not send any navy ships to the region.
Trump said Tehran wanted a deal to end the fighting, but that he was not prepared to make one on current terms, without giving further details.
Iran's Foreign Minister Abbas Araghchi said his country was not interested in talks with Washington.
However, he did say he was ready to speak to countries "who want to talk to us about the safe passage of their vessels".
"I cannot mention any country in particular, but we have been approached by a number of countries" seeking such safe passage, he added.
Meanwhile, traders hoping for an early end to the conflict were left disappointed after Trump's top economics adviser Kevin Hassett said the Pentagon estimates it could take up to six weeks, though the operation was ahead of schedule.
Both main crude contracts advanced. Brent shot up around three percent to as high as $106.50 before paring the gains, while West Texas Intermediate sat around $99.
And with worries growing about a possible energy crisis that could hammer the global economy, equity markets remained under pressure.
Tokyo, Shanghai, Sydney, Seoul, Wellington, Manila and Jakarta were all down, though Hong Kong, Singapore and Taipei edged up.
"Equities may welcome any sign that Hormuz could be reopened, but with further strikes still being threatened and diplomacy still patchy, conviction is low," said Charu Chanana at Saxo Markets.
Adding to economic concerns was data showing Friday that fourth-quarter U.S. gross domestic product expanded 0.7 percent, much slower than the initial reading of 1.4 percent.
And delayed figures showed the Federal Reserve's preferred inflation gauge dipped to 2.8 percent in January before energy prices shot higher.
"Developments over the weekend, while no more disconcerting than at the end of last week, don't offer any obvious pretext for a less pessimistic start to the new trading week," warned National Australia Bank's Ray Attrill.
Also in view this week are policy meetings at seven major central banks including the Fed, Bank of England and the European Central Bank.
While they are expected to stand pat on interest rates, any remarks on the impact of the war on their respective economies will be closely followed.
Japan says beginning release of strategic oil reserves
Japan said on Monday it was beginning the release of its strategic oil reserves after the International Energy Agency indicated earlier that the release would begin in Asia and Oceania before other regions.
IEA members agreed on March 11 to tap oil stockpiles to cushion the surge in prices caused by the war in the Middle East.
Japan, which depends on the Middle East for 95 percent of its oil imports, said Monday in a notice in its official government gazette that the level of oil reserves in the country "is being lowered".
The issuance of the notice compels managers of oil reserves to release part of their stockpile to meet the new standard.
Many Japanese media interpreted the notice as confirmation the release had already begun.
Minoru Kihara, top spokesman for the government, said Monday the country would release 15 days worth of private-sector petroleum reserves.
Takaichi said last week that the country planned to release one month's worth of national reserves.
The IEA said earlier a total 271.7 million barrels of government-managed stocks would be released worldwide.
"Individual implementation plans have been submitted to the IEA by Member countries. These plans indicate that stocks will be made available by IEA Member countries in Asia Oceania immediately," said the IEA.
"Stocks from IEA Member countries in the Americas and Europe will be made available starting from the end of March," it added.
