Oil and gold prices soar after Israel's attacks on Iran

The Guardian

3 days ago

The price of oil and gold has soared and stock markets have fallen after Israel's strikes against targets in Iran.
The escalation of the conflict in the Middle East, the focal point of global oil production, prompted a sharp increase in prices, with Brent crude up more than 10% after news of the attacks broke, reaching its highest level since January.
The price later eased but was still up 5.5% at $73.12 a barrel, on course to record the biggest daily rise since 2022.
In London, the FTSE 100 – which closed at a record high on Thursday – fell 50 points on opening. The oil companies BP and Shell were among the few risers.
The increases hit the aviation industry, as airlines cleared the airspace over the region, and investors turned to safe investment assets such as gold and the Swiss franc.
Shares in the British Airways owner, IAG, and the budget airline easyJet fell more than 4%.
The price of gold rose 1.5% to $34,434 an ounce, close to the record high of $3,500 it hit in April, and the Swiss franc and yen rose about 0.4% against the dollar.
'The geopolitical escalation adds another layer of uncertainty to already fragile sentiment,' said Charu Chanana, the chief investment strategist at Saxo.
Stocks dived in Asia, with Japan's Nikkei down 1.3%, South Korea's Kospi falling 1.1% and Hong Kong's Hang Seng dipping 0.8%.
Pan-European Stoxx 50 futures fell 1.6% and US markets are set to follow suit when they open later on Friday, led by a sell-off in Wall Street futures. S&P E-mini futures fell 1.7% and Nasdaq futures dropped 1.8%.
Israel, which said its attack was a 'pre-emptive strike' over Iran's nuclear programme, has declared a state of emergency as its military said Tehran had launched 100 drones in retaliation.
Marco Rubio, the US secretary of state, called Israel's strikes against Iran a 'unilateral action' and said Washington was not involved.
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The move to perceived safe haven assets has resulted in the yield on 10-year US Treasury notes falling to a one-month low of 4.31%.
The US dollar index rose 0.5%, while the euro fell 0.4% and sterling slipped 0.5%.
US and Iranian officials were scheduled to hold a sixth round of talks on Tehran's escalating uranium enrichment programme in Oman on Sunday.
'While we await further news and a potential response from Iran, we are likely to see a further deterioration in risk sentiment as traders cut risk seeking positions ahead of the weekend,' said Tony Sycamore, an analyst at IG.