Oil prices jump, U.S. markets retreat as Iran war worsens supply concerns
Global News
U.S. benchmark crude oil jumped US$4.52 to US$91.77 a barrel. Brent, the international standard, climbed US$5.34 to US$97.32 per barrel after briefly eclipsing the US$100 level.
Markets on Wall Street retreated and oil prices jumped another five per cent again early Thursday as the war in Iran approached its second week with no indication that the United States and Israel were ready to scale back their attacks.
Futures for the S&P 500 lost 0.5 per cent before the opening bell, while futures for the Dow Jones Industrial Average were 0.6 per cent lower. Nasdaq futures were also down 0.5 per cent. On Wednesday, the Dow declined 0.6 per cent to its lowest level the year.
Oil prices initially shot more than nine per cent higher as supply concerns worsened with Iranian attacks on commercial shipping around the Strait of Hormuz. The U.S. campaign of airstrikes in Iran is now in its 13th day.
U.S. benchmark crude oil jumped US$4.52 to US$91.77 a barrel. Brent, the international standard, climbed US$5.34 to US$97.32 per barrel after briefly eclipsing the US$100 level.
Iran has escalated its attacks aimed at generating enough global economic pain to pressure the United States and Israel to end the war, targeting oil fields and refineries in a handful of Gulf Arab nations. Iran’s actions have effectively stopped cargo traffic through the narrow Strait of Hormuz, through which a fifth of all traded oil passes.
In response, the International Energy Agency agreed Wednesday to release 400 million barrels of oil, the largest volume of emergency oil reserves in its history, in a bid to counter the war’s effects on energy markets. The U.S. planned to release 172 million barrels of oil next week from its Strategic Petroleum Reserve to combat steep prices.
The IEA’s announcement came a day after energy ministers from the Group of Seven — the leading industrialized nations of Canada, the United States, France, Italy, Japan, Germany and Britain — met in Paris to look at ways to bring down prices.
But the continued strife and uncertainty have fueled speculation prices could push still higher, and that pulled markets around the globe lower.
