DAX Falls as Oil Spike Pressures Risk Appetite

Oil remains the key market driver. Brent crude hit a five-month high on Friday before easing Monday, but traders are still weighing fresh geopolitical tension in the Middle East, including renewed attacks on two tankers in the Persian Gulf and a Houthi strike on Saudi Arabia. US Energy Secretary Chris Wright said Gulf oil shipments have recovered to about 80% of pre-conflict levels, though refined product flows remain constrained.

That matters for investors because higher oil prices feed directly into inflation expectations, corporate input costs and central bank policy assumptions, especially in Europe’s export-driven economy. German equities are particularly sensitive to energy costs, margin pressure and any knock-on effect on consumer demand.

The move also reflects a broader risk-off tone after Wall Street’s chip-led selloff last week rippled through global markets. The S&P 500 came under pressure as investors sold semiconductor shares, adding to caution around cyclical assets.

For now, the oil market remains the main swing factor. Brent had fallen to $70 over the summer on hopes of lower Middle East risk, but with Iran-US talks stalled for months, prices have climbed back sharply. Brent is now about 15% below this year’s peak, but still roughly 80% higher than at the start of 2025, keeping energy costs and market volatility in focus.