Key Market Moves on Rising Middle East Tensions
- Brent crude surged 7.4% early Thursday, surpassing $108 per barrel, while WTI gained 7% to $107.
- Asian stocks slipped, led by South Korea’s Kospi, which fell 4.5%.
- European markets opened mostly lower, with US futures signaling a weaker start.
Oil Prices React to Geopolitical Fears
Oil prices climbed sharply on Thursday following inflammatory remarks by US President Donald Trump and Iranian officials. Investors fear that the conflict could escalate further, pushing Brent above $108 per barrel and WTI to $107.
Market sentiment deteriorated overnight after Trump’s televised address, which offered no clarity on timelines or conditions for ending hostilities against Iran, according to Deutsche Bank analysts. “There was no signal of the US seeking an imminent exit,” they noted.
Trump’s Statements and Iran’s Response
Speaking from the White House Wednesday, Trump said the war against Iran was “nearing completion” but warned that the US would “hit Iran extremely hard over the next two to three weeks.” Tehran responded with threats of “more extensive and destructive actions.”
Trump also reiterated the possibility of bombing Iran’s power plants if the country refused to meet US demands. He added that reopening the Strait of Hormuz should be the responsibility of countries that rely heavily on its oil shipments. “The United States imports almost no oil through the Hormuz strait and won’t be taking any in the future. We don’t need it,” he said.
Global Supply Context
While the US, the world’s largest oil producer, is relatively insulated from supply disruptions compared with Asia and Europe, it still imports certain types of crude. Prices for different grades are set globally, so the US remains exposed to oil market moves.
Even after hostilities end, full resumption of shipping through the Strait of Hormuz will take time. Claudio Galimberti, chief economist at Rystad, said flows could resume within days, but reaching around 20 million barrels per day may take several weeks, depending on security and insurance conditions.
Middle East Conflict Escalates
The conflict continues to flare. Iran launched missiles at Israel early Thursday, while Abu Dhabi intercepted a missile near an industrial hub. The US embassy in Iraq warned of potential attacks by Iran-aligned groups in central Baghdad over the next 24–48 hours, urging Americans to leave the country.
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