Oil prices surged over 5% and global stocks fell sharply after Iran attacked Gulf energy sites, raising fears of a wider conflict and energy supply shock
HONG KONG: Oil prices soared and global stock markets sank on Thursday. The sell-off followed Iranian missile strikes on key Gulf energy facilities in retaliation for an attack on its South Pars gas field.
Brent crude surged more than 5% to breach $113 per barrel. West Texas Intermediate climbed to around $97 as supply fears intensified.
Iran’s Revolutionary Guards warned of further attacks. “If it is repeated again, further attacks on your energy infrastructure and that of your allies will not stop until it is completely destroyed,” a statement said.
The strikes targeted Qatar’s Ras Laffan, the world’s largest liquefied natural gas hub. European gas prices jumped more than 30% following the reported damage.
Iranian President Masoud Pezeshkian said the situation could have “uncontrollable consequences”. He warned the crisis “could engulf the entire world” in a post on social media platform X.
US President Donald Trump said Washington “knew nothing” of Israel’s initial strike. He vowed “NO MORE ATTACKS WILL BE MADE BY ISRAEL” if Iran ceased its attacks on Qatar.
Trump warned the US would “massively blow up the entirety of the South Pars Gas Field” if Tehran did not comply. The field is a massive resource shared with Qatar.
Asian equity markets fell sharply on the rising tensions. Tokyo’s index tanked more than 3%, while Seoul dropped over 2%.
Hong Kong, Shanghai, Sydney, Singapore, and Mumbai were also lower. The sell-off reversed a positive start to the week driven by tech stocks.
The UN nuclear watchdog said Iran reported a projectile impact at its Bushehr power plant. It confirmed the incident caused no damage to the facility.
French President Emmanuel Macron called for a moratorium on strikes targeting civilian infrastructure. He said it was in the “common interest” to protect energy and water sites.
Markets have been volatile since the conflict began, with Iran targeting Gulf sites. The Strait of Hormuz, a vital oil chokepoint, has been effectively closed.
The surge in energy costs has reignited inflation fears. It has also raised the prospect of central banks keeping interest rates higher for longer.
US Federal Reserve Chair Jerome Powell acknowledged the uncertainty. “We’re right at the beginning of this, and we don’t know how big — you just don’t know how big this will be and how long it lasts,” he said.
The Bank of Japan held rates but warned of inflation spiking due to higher crude prices. This followed a rate hike by the Reserve Bank of Australia earlier in the week.
Investors are now focused on policy decisions from the European Central Bank and the Bank of England. Their responses to the energy-driven inflation threat are keenly awaited.
