FTSE 100 Plunges Amid US-Iran Conflict's Strait of Hormuz Blockade

The FTSE 100 index in London fell on Monday as tensions between the US and Iran escalated, causing volatility in global oil markets. The conflict has resulted in a de facto blockade of the Strait of Hormuz, which is responsible for one-fifth of the world's daily oil supply.

The fragile ceasefire that had restored 50% of pre-war oil flows through the waterway has disintegrated over the past week. This has led to a surge in Brent crude prices, threatening to import inflation into energy-dependent economies across Europe and East Africa.

Oil majors such as Shell and BP have been hit hard by the crisis, with their shares sinking 2.4% and 4.7%, respectively. The FTSE 100's vulnerability to Middle Eastern instability has left it exposed to the high energy prices that are expected to continue.