European equities were little changed on Monday as investors assessed the impact of impending U.S. sanctions on Iran and the broader geopolitical fallout from recent military strikes.
The Stoxx Europe 600 Index closed flat at 654.22, with regional benchmarks mixed. Germany’s DAX declined 0.1%, France’s CAC 40 fell 0.4%, and the UK’s FTSE 100 rose 0.3%. Energy stocks lagged as Brent crude futures eased 1.5% to around $91.27 a barrel, following a 5% surge the prior week.
Oil markets remained sensitive to developments in the Middle East, where the Iranian rial hit a record low of roughly 2.02 million per dollar on informal markets, compared with the official central bank rate of about 1.5 million. The currency’s slide accelerated after U.S. and Israeli strikes on February 28, compounding double-digit inflation and negative growth in Iran.
Iran’s foreign ministry warned that any escalation would have consequences, while U.S. Treasury Secretary Scott Bessent described new measures as the "single greatest financial offensive ever marshalled against an adversary." Bessent urged Iran’s allies to cut ties with Tehran to "deepen their access to global capital" and bolster market confidence. Iranian President Masoud Pezeshkian reiterated his preference for the June memorandum of understanding with the U.S., though the 60-day negotiating deadline has passed.
Elsewhere, BW Offshore shares tumbled 14% after the company slashed its pre-tax profit forecast. The decline came as the broader energy sector faced volatility amid shifting geopolitical and sanctions risks.
Talks between Oman and Iran are scheduled for Tuesday to discuss shipping management through the Strait of Hormuz, including potential transit-fee adjustments.
