Oil hits three-week high on Iranian warning

Markets Update: Oil prices rise after a warning to western nations from Iran over proposed sanctions on the country's oil exports.

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Oil prices rose to a three-week high after the latest round of sabre-rattling from Iran, after the country's vice president issued a warning to western nations over proposed sanctions on the country's oil exports.

"If Iran oil is banned not a single drop of oil will pass through Hormuz Strait," Mohammad Reza Rahimi told the official IRNA news agency yesterday.

Brent futures increased 26 cents to $110.08 a barrel in trading this morning, extending a three-day rise.

The UAE's markets held steady, making gains despite headwinds on international markets.

The Dubai Financial Market General Index rose 1 per cent to 1,332.24, while the Abu Dhabi Securities Exchange General Index gained 0.3 per cent to 2,359.99.

Aldar Properties' stocks snapped a two-day losing streak to climb 1.2 per cent to 82 fils each, as the company's board prepares for a meeting where it will discuss asset sales. The board meeting takes place after markets close today.

Financial stocks began the trading day heading upwards, with Mashreq, Dubai Islamic Bank and Tamweel leading gains on Dubai's market. Abu Dhabi Commercial Bank and Abu Dhabi Islamic Bank gained in the capital.

Asian stocks dropped slightly in the early hours of the morning after Japan's government reported a decline in industrial output and consumer prices, with the Nikkei 225 index declining 0.2 per cent to 8,423.62. The Hang Seng Index lost 0.7 per cent to 18,482.89.

S&P 500 futures fell 0.2 per cent, pointing to a lower open on Wall Street.

Gold fell again for the fifth day running, with the yellow metal falling 0.6 per cent to $1,588.52 per troy ounce.