Oil Prices Surge Amid Middle East War as Global Stock Markets Split
Global oil prices climbed sharply on Wednesday as renewed military action between the United States and Iran increased concerns about energy supplies and major international shipping routes.
Brent North Sea crude, the global benchmark, briefly moved above $95 per barrel for the first time in nearly six weeks. Although crude futures later surrendered part of their gains, prices remained approximately three percent higher.
Escalating US-Iran Conflict Pushes Oil Higher
John Kilduff of Again Capital said military activity had resumed at an exceptionally intense level, while public statements from both sides were becoming increasingly aggressive.
US President Donald Trump warned that the United States could destroy an Iranian bridge or power facility in response to every attack on commercial shipping in the Strait of Hormuz.
Iranian Foreign Minister Abbas Araghchi issued a similar warning. In a post on X, he said Iran would respond equally to any strike targeting the country’s infrastructure, describing Tehran’s defence policy as “eye for an eye.”
The Strait of Hormuz is a crucial passage for global energy shipments, meaning any disruption could have a significant effect on international oil supplies and prices.
Ships Turn Back After Houthi Blockade Announcement
Tensions also increased near the Bab al-Mandab strait, located at the southern entrance to the Red Sea.
Maritime information reviewed by AFP indicated that at least nine vessels had reversed course instead of crossing the waterway. The change followed an announcement from Houthi rebels declaring a blockade of Saudi Arabian ports.
Data provider Kpler reported that three of these ships had loaded oil at Saudi Arabia’s Yanbu terminal on the Red Sea coast.
The Yanbu facility is strategically important because it allows Saudi Arabia to export oil without relying entirely on the Strait of Hormuz.
US Stock Markets Show Limited Reaction
Despite the rise in oil prices, Wall Street recorded only modest losses. The S&P 500 declined by 0.1 percent, while the Dow Jones Industrial Average closed almost unchanged.
Arun Sundaram, senior vice president at CFRA Research, pointed to several challenges facing investors. These included fresh tariff threats from Trump, rising US government bond yields and concerns about China’s competitiveness in artificial intelligence.
Sundaram compared the market to a boxer continuing to stand after absorbing repeated blows, highlighting its resilience despite growing economic and geopolitical pressures.
Technology Stocks Return to the Spotlight
Alongside developments in the Middle East, investors remained focused on the technology industry.
European markets performed relatively well as investors shifted money away from technology companies. Chris Beauchamp, chief market analyst at IG, said this rotation helped European shares resist the pressure created by stronger oil prices.
Technology stocks had recovered on Wall Street on Tuesday but struggled again on Wednesday. The technology-heavy Nasdaq Composite ended the session 0.6 percent lower.
Major companies investing heavily in artificial intelligence infrastructure, including Amazon, Meta and Microsoft, recorded notable declines.
Russ Mould, investment director at AJ Bell, said the recent retreat in semiconductor stocks had increased investor demand for updates on AI-related sales and infrastructure spending.
Alphabet, Google’s parent company, was scheduled to release its financial results on Wednesday evening. Intel was expected to report the following day, while Microsoft, Meta and several other major technology businesses were due to announce earnings the next week.
Asian stock markets closed with mixed results as traders waited for financial reports from leading technology companies.
Key Global Market Figures
| Market or Asset | Closing Level or Price | Change |
|---|---|---|
| Brent North Sea crude | $94.07 per barrel | Up 3.4% |
| West Texas Intermediate | $86.83 per barrel | Up 3.0% |
| Dow Jones | 52,218.58 | Flat |
| S&P 500 | 7,498.96 | Down 0.1% |
| Nasdaq Composite | 25,690.90 | Down 0.6% |
| FTSE 100 | 10,716.97 | Up 1.2% |
| CAC 40 | 8,437.89 | Up 0.9% |
| DAX | 25,155.41 | Up 0.6% |
| Nikkei 225 | 66,115.60 | Down 0.2% |
| Hang Seng Index | 24,892.66 | Down 1.0% |
| Shanghai Composite | 3,867.03 | Up 0.1% |
At approximately 2010 GMT, the euro strengthened to $1.1411 from $1.1398. The pound slipped slightly to $1.3372, while the euro rose to 85.33 pence. The dollar weakened marginally against the yen to 163.15.
Oil prices rose sharply as escalating US-Iran military action and threats to important shipping routes increased concerns about global energy supplies.
However, stock markets remained relatively stable, with investors also concentrating on technology earnings, AI spending and other economic pressures.
