Latest news with #IsraelIranWar
Forbes
a day ago
- Business
- Forbes
Israel-Iran War: What To Expect With Oil And Stock Prices
Iranians burn an Israeli flag during the annual Quds (Jerusalem) Day commemorations and the funeral ... More of seven Revolutionary Guard Corps members killed in a strike on the country's consular annex in Damascus, which Tehran blamed on Israel, on April 5, 2024 in Tehran. The Guards, including two generals, were killed in the air strike on April 1, which levelled the Iranian embassy's consular annex in Damascus. The funeral ceremony coincides with the annual Quds (Jerusalem) Day commemorations, when Iran and its allies stage marches in support of the Palestinians. (Photo by ATTA KENARE / AFP) (Photo by ATTA KENARE/AFP via Getty Images) The Israel-Iran war has taken center stage today. As you may know, Israeli defense forces launched multiple bombs into Iran successfully striking about one hundred targets, including Iran's nuclear facilities. Israel also killed six scientists. Among them were two of Iran's top nuclear scientists. Israel also eliminated at least four military leaders including Maj. Gen. Hossein Salamani, the man in charge of Iran's Islamic Revolutionary Guard Corps. In retaliation, Iran launched a hundred drones against Israel. According to multiple sources, Israel successfully shot down all drones. While Israels attack dealt a serious blow to Iran's already weak military force, investors around the world are watching oil prices rise and stocks fall. How long could these conditions persist? Should investors sell stocks on the news or ride it out? During the first few months of the Trump presidency, the price of oil and gasoline fell. This is a key reason inflation has dropped to 2.4% over the past 12 months, less than 0.50% from the Feds target rate of 2.0%. After peaking January 14 at $80.73, oil fell to a low of $58.50 on May 2. In the aftermath of yesterday's attack, the price of oil has risen to $72.32 on fear of less supply. Will the United States and other countries be able to increase supply to help stabilize the price of oil? The purpose of drilling for oil differs from the United States to the Middle East. In the U.S., drilling for oil is conducted by companies looking to profit while in the Middle East, oil production is conducted by the government and is a major source of revenue. In America, oil companies tend to produce at maximum capability while in the Middle East, there tends to be more room to expand production. Will supply keep up with demand? That depends. Iran has said it will interfere with oil shipments traveling through the Strait of Hormuz. The Strait of Hormuz is a narrowed passage linking the Persian Gulf with the Gulf of Oman and the Arabian Sea. Will Iran succeed? Most experts think not. If correct, the price of oil may not stay elevated for long. We'll see. Stocks fell on the news of the Israeli attack, which is no surprise. Stock markets tend to overreact to news events, and this morning was no exception. After falling about 1.60% initially, the DJIA rebounded and was down 0.87%. Currently, it is down about 1.46%. The situation in the Middle East is very fluid and things can change rather rapidly. But if today's action is any sign, the problem may not pose as severe of a threat to financial markets as initially thought. We'll know more as stock trading approaches the end of the trading day. Why? If stocks rebound and future attacks are minimal, this could be short lived. However, if Iran is successful in a counterattack, Israel would likely strike back with even greater force, and other countries may decide to get involved. Even now, Iran has launched multiple missiles against Israel, including the city of Tel Aviv. While the tiny country of Israel has a stronger military than Iran, how much damage will Iran cause? That is the wild card here. If this conflict lingers, would other countries get involved? It's possible but may not be likely. Why? Currently, Israel has a decided military edge over Iran so it's logical to assume that the first country to get into the fray would be to help Iran. The list of those countries includes Russia, China, and perhaps a country or two in the Middle East. Russia is struggling economically with its war against Ukraine and probably would not get involved as it would further stretch its limited resources. China is reportedly on the verge of an important trade agreement with the U.S. and may not want to jeopardize it. If a country in the Middle East gets into this conflict, it could cause the price of oil to rise, but stocks may be less affected. In support of Israel, I doubt the U.S. would get deeply involved but do expect we will be prepared to act if necessary. How will the Israel-Iran war turn out? While no one can say with certainty, Iran may not be up to the task of succeeding in a war against Israel. If this is correct, Iran would be unable to cause a major disruption in global financial markets. Therefore, oil could go higher, but I expect stocks will moderate and look beyond this conflict, focusing instead on the U.S. economy, tariffs and trade, and inflation. We'll see.
Khaleej Times
a day ago
- Business
- Khaleej Times
Israel-Iran clash: Etihad Airways not accepting transit passengers of cancelled flights
The UAE national carrier Etihad Airways on Friday said it will not accept transit passengers to cancelled flights. Etihad and other local carriers Emirates and flydubai announced the cancellation, rerouting and delaying flights due to the Israel-Iran war, which is spreading into a regional conflict. 'Guests transiting through Abu Dhabi to connect to cancelled flights will not be accepted for travel from their point of origin… 'Impacted guests are being assisted with alternative travel arrangements,' the Abu Dhabi-based airline said in a statement to Khaleej Times on Friday. Etihad earlier announced cancelling EY595 / EY596, EY593 / EY594, and EY597 flights to Tel Aviv and extended the delay of EY590 from Amman (AMM) to Abu Dhabi (AUH). It also warned that some of the flights that are subject to schedule to operate EY595 / EY596 between Abu Dhabi and Tel Aviv are currently scheduled to operate but may be subject to delay. After the Israel-Iran conflict, countries closed their airspace including Iran, Iraq, Jordan and Syria for the safety of commercial flights. Israel attacked Iran with 200 aircraft in the wee hours on Friday, targeting the Persian country's nuclear, military and missile sites. 'In addition, Etihad is re-routing a number of flights in response to restricted airspace in parts of the Middle East,' it said. 'This remains a developing situation and is likely to cause some disruption and delays over the coming days. Etihad is continuously monitoring airspace and security updates in close coordination with the relevant authorities,' it said. Travellers are advised to check the latest flight status at the airline's website or mobile app. 'The safety of our guests and crew remains our highest priority, and we regret any inconvenience caused.' Earlier, Emirates said it is 'closely monitoring the situation' and making all efforts to ensure minimal disruption to customers while assisting impacted passengers.
