Oil prices are climbing on concerns about an escalating Iran war
Stock markets recorded losses on Thursday as fresh inflation fears came into focus following a jump in oil prices. This comes amid reports that US President Donald Trump was considering further strikes on Iran ahead of next month's US midterm elections.
Oil prices surged on Thursday as uncertainty surrounding the ongoing conflict between Iran and the US sent shockwaves through global markets. Despite recent signs that Middle Eastern exports were nearing pre-war levels and G7 nations agreed to release their oil stockpiles, rising tensions in the Strait of Hormuz and concerns over dwindling global reserves reignited fears of a potential crisis.
The White House reportedly considered deploying military strikes on Iranian targets ahead of the US midterm elections, despite no expectation that such action would end the war or restore safe passage through the strategic waterway. Major crude benchmarks climbed more than 2% on Thursday, with Brent crude reaching $102.68 per barrel and West Texas Intermediate breaking $90.20 a barrel.
Inflation concerns grew, pushing government bond yields to multi-year highs, which in turn weighed on stock markets across Asia. Investors braced for earnings season and grappled with the potential impact of rising borrowing costs on corporate profits. Meanwhile, the euro weakened, and gold prices edged upward.
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