World shares mostly retreated and oil prices jumped on Monday after President Donald Trump warned Tehran that the “clock is ticking” as U.S.-Iran negotiations over a permanent end to the war stall.
Drone attacks on the UAE and Saudi Arabia on Sunday also raised concerns of an escalation in the conflict.
Saudi Arabia, which intercepted three drones that entered from Iraqi airspace, warned it would take the necessary operational measures to respond to any attempt to violate its sovereignty and security.
Oil Touches 2-Week High
Brent crude futures were up 57 cents, or 0.52 percent, at $109.83 a barrel after touching $112 for their highest since May 5.U.S. West Texas Intermediate crude was up 79 cents, or 0.75 percent, at $106.21 after touching its highest since April 30 at $108.70. The front-month June contract expires on Tuesday.
Both contracts gained more than 7 percent last week as hopes dimmed for a peace deal to end ship attacks and seizures around the Strait of Hormuz trade route.
U.S. futures fell and markets in Japan and South Korea pulled back from their records. In early European trading, Britain's FTSE 100 edged up 0.1 percent to 10,205.31. France's CAC 40 lost 0.9 percent to 7,883.42, and Germany's DAX dropped 0.1 percent to 23,925.82.
During Asian trading, Tokyo’s Nikkei 225 fell 1 percent to 60,815.95, a decline led by technology-related stocks. It reached all-time intraday high levels last week above 63,000.