Europe open: Shares up despite doubts over Trump plan for Gulf oil shipments

(Sharecast News) - European shares gained at the open on Wednesday despite uncertainty over the reasons and objectives for the US-Israeli war on Iran and American assurances on safeguarding oil shipments through the key Strait of Hormuz. The pan-regional Stoxx 600 index was up 0.2% to 605.64 at 0841 GMT with all regional bourses higher.

Oil prices were 3% higher, sending Brent crude to $83.96 a barrel as a US plan to insure and escort tankers going through the strait failed to inspire any confidence.

The vital waterway has been effectively closed since Israel and the US started bombing Iran on Saturday - killing the country's leader Ali Kohmenei in the process - as they seek to topple the Islamic regime.

Counterstrikes from the Iranians and their Hezbollah militia allies based in Lebanon against multiple Gulf states have sparked global concerns about supply disruptions, pushing the oil price to its highest level in six years.

Meanwhile gas prices have almost doubled since last Friday, with the Dutch TTF contract price for April at €56.6 per megawatt hour, up 4.2% on Tuesday and well above Friday's €31.95.

Iran's revolutionary Guard has threatened to attack any ship that attempts to pass through the narrow strait. US President Donald Trump on Tuesday said the US International Development Finance Corporation would offer insurance to vessels and provide a naval escort if necessary.

"Until there is a pause in this conflict and free flowing oil around the world, it is hard to see how markets can stage a meaningful recovery. We expect stocks and bonds to remain nervous and driven by headline risk," said XTB research director Kathleen Brooks.

"The dollar has been king during this crisis. However, it is pulling back slightly today, and G10 currencies are clawing back some recent losses. This is likely to be temporary, especially if the oil price remains to the upside."

In equity news, shares in Vistry tanked as the UK housebuilder is CEO and chair was retiring and warned of margin pressure this year. Adidas also fell after the German sportswear giant reported annual results.

Redcare Pharmacy also plunged as fourth-quarter earnings missed estimates.

Reporting by Frank Prenesti for Sharecast.com