Oil prices jumped on Thursday after reports suggested that the United States might launch new attacks on Iran before the upcoming midterm elections. This raised fears of further disruptions in oil supply. However, the surge in prices eased when President Donald Trump stated that the US would not attack Iran before the elections, mentioning ongoing discussions with Tehran.
Brent North Sea crude, a global oil price benchmark, climbed to about $105.88 a barrel before settling at $104.28. The US oil benchmark, West Texas Intermediate, reached around $93.20 per barrel but closed at $91.49.
Reports indicated that the White House had asked the Pentagon to prepare options for strikes on Iran ahead of the elections on November 3. With the Republican Party potentially facing losses in Congress, escalating the conflict with Iran could add more pressure on Trump.
As Americans deal with high diesel prices, Trump confirmed on his social media platform that there would be no attacks on Iran before the elections. Despite this, oil markets remain tense due to increased Iranian attacks in the Strait of Hormuz and concerns about Hurricane Isaias affecting oil production in the Gulf of Mexico.
The rise in oil prices is raising worries about inflation and pushing up government bond yields, which have reached levels not seen in over 20 years. Investors fear that continued inflation could lead central banks to increase interest rates, which might slow down economic growth and negatively impact stock market values.
As a result, stock markets reacted negatively, with major indexes in the US and Europe closing lower. Energy companies benefited from higher oil prices, but technology stocks, including Samsung and SpaceX, faced declines.
[logo-slider]
