* Investors wary as Iran reviews US proposal

* Stocks and gold slip while oil advances

* Markets worried about energy price shocks

(Updates after start of Wall Street trading)

By Marc Jones and Ankur Banerjee

LONDON/SINGAPORE, March 26 (Reuters) - Stock and bond

markets fell on Thursday as oil surged more than 5%, with Iran's

denial of any talks with the U.S. deepening doubts over the

prospect of a quick ceasefire in the near one-month-long Middle

East war.

Conflicting signals over the scope of contact, plus reports

of thousands of U.S. troops being sent to the region, snapped a

three-day rebound in world stocks and reignited selling in

global debt markets.

After falls in Asia - where the Philippines held an

unscheduled central bank meeting due to the turmoil - European

stocks and government bond prices dropped as Germany's

central bank head said an ECB rate increase next month was "an

option"and Norway said it was now likely to hike rates this year

too.

A warning from U.S. President Donald Trump to Iran to "get

serious" about a ceasefire saw oil and European natural gas

prices jump more than 5.5% and 4% respectively.

It hoisted Brent to just over $107 a barrel and gas

to 54.9 euros per megawatt hour, leaving their gains

for the month atan eye-watering 45% and 70% and cementing the

worries of policymakers about another 2022-style inflation

spike.

"I think we'll have enough data by April to determine

whether we need to take action or whether we can wait and see,"

Germany's central bank chief Joachim Nagel said during an

interview with Reuters regarding a possible ECB rate hike.

He said it was just one of the options the ECB had, but

added: "We shouldn't shy away from it now just because we think

it's still too early."

Trump repeated on Thursday that Iran was "begging" to make a

deal to end the war. Iran's Foreign Minister, Abbas Araqchi, had

earlier countered that Tehran was reviewing a U.S. proposal but

had no intention of holding talks.

The war, triggered by U.S.-Israeli strikes on Iran in late

February, has rattled global markets and effectively shut the

Strait of Hormuz, a conduit for a fifth of global oil and

liquefied natural gas flows.

A first economic forecast from the Paris-based OECD since

the crisis erupted predicted it would suppress global GDP

growth, keeping it below 3% this year.

Germany's two-year bond yield, sensitive to

European Central Bank rate expectations, rose 8 basis points to

2.68%, after falling 4 bps on Wednesday. Bond yields move

inversely to prices.

The U.S. two-year yield was nearing 4%, while

Japan's hit its highest level in 30 years at 1.33%,

as traders cemented bets on another Bank of Japan rate hike as

early as next month.

Prolonged disruption in the strait could keep energy prices

and inflation elevated, forcing central banks to tighten, Pascal

Koeppel, chief investment officer at Vontobel SFA, said.

Earlier on Thursday, Norway's central bank said it now

expects to raise its rates this year due to rising energy prices

and wages, after previously flagging it could cut them.

"If we saw (U.S.) ground troops in action, that would make

me much more nervous," Vontobel's Koeppel added. If that

happened, "we would trim risk... and go more into short-term

government bonds and gold, of course."

STRUCTURAL SHIFTS

Wall Street'smain markets also opened around 1% lower,

and Asian markets fell overnight.

Japan's Nikkei ended down 0.3%, while worries over

rising energy costs hammered South Korea's KOSPI, which

slumped 3.2%.

Hong Kong's Hang Seng fell 1.9% and China's blue

chips dropped 1.3%, leaving MSCI's index of

Asia-Pacific shares outside Japan on track for a

9.5% monthly fall, its biggest since October 2022.

In currencies, the dollar held near recent highs and

is heading for a 2% gain this month, reviving its safe-haven

appeal after last year's more than 9% slide.

Fears of a 2022-style inflation shock have seen traders

fully price out any chance of a Federal Reserve rate cut this

year, further supporting the dollar.

Gold, another traditional safety play, has dropped

more than 16% this month - on course for its steepest fall since

October 2008. It was down 2% at $4,421 per ounce on Thursday,

though still almost 50% higher than a year ago.

"If you look at what the U.S. wants to achieve, what Israel

wants to achieve, and what Tehran wants to achieve, it will be

very hard to reconcile all these points," said Matthias

Scheiber, senior portfolio manager and the head of the

multi-asset team at Allspring Global Investments.

"We still think there is a case to make for structurally

higher energy prices for the moment."