Europe midday: Shares gain, oil hits $108 as Iran 'offers deal' on Hormuz

(Sharecast News) - European shares made strong gains by midday on Monday and oil briefly pushed beyond $108 a barrel as talks between the US and Iran continued to stall, although Tehran had reportedly offered to end its blockade of the strait of Hormuz without addressing its nuclear program.

The pan-regional Stoxx 600 index was up 0.55% to 614 at 1235 BST. Germany's DAX gained 0.90%, France's CAC 40 rose 0.64% and Italy's MIB increased 0.66%.

Brent crude rose to its highest level since a ceasefire was agreed between Washington and Tehran on April 7, increasing to $108 a barrel after US President Donald Trump cancelled plans to send US envoys Steve Witkoff and Jared Kushner for talks in Pakistan on Saturday. It pared gains to be 0.72% higher on the day at $106.13.

Iran is offering to end its chokehold on the strait of Hormuz without addressing its nuclear program, ABC news cited two regional officials with knowledge of the proposal as saying.

Iran also wants the US to end its blockade of the country as part of its proposal, said the two officials, who spoke on condition of anonymity to discuss the closed-door negotiations.

News service Axios reported that Iran had tabled a new proposal to reopen the strait of Hormuz, and end the war, with nuclear negotiations postponed for a later date.

"We need to hear from the US to see if this plan will bear fruit and reopen the Strait, but as the conflict drags on, investors are getting worried about the impact on energy prices," said XTB research director Kathleen Brooks.

"There are growing expectations that the oil price will remain higher for longer, as the blockade on the Strait enters its third week. Goldman Sachs has increased its Q4 oil price target to $90 per barrel, from $80, as disruption to production persists for the coming months."

"The longer the blockade lasts for the bigger risk there is to Iranian oil fields. They differ from other wells in the region because they work on low pressure. If they are shut down due to the blockade and a lack of storage, it could cause permanent damage to Iran's energy infrastructure."

In equity news, Hiab shares surged after Danske Bank, Nordea and SEB all lifted their target price on the stock.

Reporting by Frank Prenesti for Sharecast.com