Oil prices soar after Israel launches strikes on Iran's capital

The price of Brent crude jumped nearly 10% higher at one stage before easing back a little to stand 7% higher at 74 US dollars a barrel.
London's FTSE 100 Index dropped 0.6%, down 56 points to 8828.6, in early morning trading on Friday after heavy overnight losses on Asian stock markets as the worries spooked investors, with the UK's top tier falling back from a record high set in the previous session.
The strikes by Israel on Iran's capital Tehran early on Friday are said to be the most significant attack the country has faced since its 1980s war with Iraq and have led to concerns over an all-out conflict between the two Middle Eastern countries.
In Washington, the Trump administration said it had not been involved in the attack and warned Iran not to retaliate against US interests or personnel.
It threatens disruption to the supply of crude from the Middle East while some traders flagged concerns it could also impact the flow of liquified natural gas (LNG) if tensions escalate.
Rising oil prices could threaten to push up inflation in the UK, possibly impacting the outlook for further interest rate cuts.
The Bank of England has been cutting rates but, as inflation strays further from the 2% target, it has less leeway to bring down borrowing costs.
Derren Nathan, head of equity research at Hargreaves Lansdown, said: 'It's not just the outlook for Iranian exports that's a concern but also the potential for disruption to shipping in the Persian Gulf's Strait of Hormuz, a key route for about 20% of global oil flows and an even higher proportion of liquified natural gas haulage.'
He added: 'The escalation of military action adds another factor to consider for central bankers in an already complex world as they weigh up the inflationary impact of ever-changing tariff rates and a weakening outlook for jobs and growth.'
On the London market, oil giants BP and Shell were among the biggest risers on the steep gains in the cost of crude, with shares up 2% for both firms.
Aerospace giant BAE Systems was also moving higher as the threat of a full-scale war in the Middle East put defence stocks back in the spotlight, with the stock up 3%.
But London-listed airlines were down sharply, hit by a double whammy as rising oil prices spell higher fuel costs for the sector and following the devastating air crash in India.
British Airways owner International Consolidated Airlines fell more than 4% and easyJet was just under 4% lower in morning trading.
Gold prices also leaped towards another fresh record as investors raced for safe haven assets, which could see it breach the 3,431 US dollars-an-ounce high set earlier this month.
Kathleen Brooks, research director at XTB, said: 'If the oil price continues to climb towards 100 US dollars in the coming days, then we could see the interest rate futures market price out rate cuts from the US and Europe, which may add to downside pressure on stocks.
'However, if there is no nuclear escalation, then we think we could see oil prices settle back around 70 US dollars per barrel.'

Try Our AI Features

Explore what Daily8 AI can do for you:

Learn with AIFact CheckingText to SpeechAI Summary

Related Articles

Reuters

33 minutes ago

• Reuters

BP shortlists former Centrica chief Laidlaw as potential chair, Sky News reports

June 21 (Reuters) - BP (BP.L), opens new tab is considering Sam Laidlaw, the former chief executive of British Gas owner Centrica (CNA.L), opens new tab, as a leading candidate to succeed Helge Lund as chair, Sky News reported on Saturday. The timing and status of Laidlaw's engagement with BP remain unclear, the report said. Ken MacKenzie, who retired as chair of mining group BHP ( opens new tab earlier this year, has also been approached about the role, Sky News added. BP declined to comment. Lund was re-elected in April with sharply reduced support amid pressure from activist investor Elliott Management and criticism from climate-focused shareholders, some of whom had called for a vote against Lund. Nearly 25% of BP shareholders opposed Lund's re-election at the annual general meeting. BP subsequently announced he would step down, likely in 2026. Board member Amanda Blanc is in charge of finding Lund's successor.

Scottish Sun

an hour ago

• Scottish Sun

Israel will keep bombing Iran's nuke sites even without Trump – we will finish the job, says Netanyahu's ex-adviser

Click to share on X/Twitter (Opens in new window) Click to share on Facebook (Opens in new window) ISRAEL will continue blitzing Iran's nuclear sites with or without the US joining strikes, Benjamin Netanyahu's ex-adviser says. It comes as Donald Trump has revealed he has opened a two-week window for talks as he mulls whether America will intervene in the conflict. Sign up for Scottish Sun newsletter Sign up 9 Israel has already struck a number of nuclear targets in Iran Credit: AFP 9 Damage inflicted on Tel Aviv after a missile Credit: Getty 9 Netanyahu will push on with his bombing campaign with or without US help Credit: EPA 9 Iran and Israel have been trading missiles for over a week Credit: Getty The US president, through White House press secretary Karoline Leavitt, said there is "a substantial chance of Iran in the near future". Trump had previously tried to curb Tehran's sprawling nuclear scheme through diplomacy. He gave Iran's regime 60 days to thrash out a deal - a deadline that passed two days before Israel unleashed unprecedented strikes on Iran's nuke sites last Friday. Trump has this week been weighing whether to give the green light for the US to step in and deploy a 15-ton mega bunker buster bomb. America's intervention has repeatedly been touted by Trump, who warned Iran would suffer the "full strength and might" of his military. But Netanyahu's ex-adviser Nadav Shtrauchler - who told The Sun the Israeli PM was preparing to strike Iran alone days before he did - said the embattled nation is prepared to carry on without the US. He said: "Of course Israel can carry on. "I think it is going swifter here than people thought when they planned it. "So Israel can proceed and have many targets to go through." Strategic adviser Shtrauchler said he believes the conflict will end with an agreement being thrashed out - and said America's involvement could change the course of the conflict. How Trump COULD destroy Iran's prize nuclear bunker US participation would most likely involve strikes against Iran's underground Fordo uranium enrichment facility, considered to be out of reach to all but America's bunker-buster bombs. Shtrauchler added: "It's a different story with the US, both with the military and the geopolitical side. It's a big deal and will change things. "It's going to end with an agreement if the regime does not fall, but it is too soon to know that. "So if the US decides against intervening you wil see more from the Israel side and at some point it will end with an agreement. "It will make an effect and will change the end result. "But for now we can see that Israel is working very well itself and we can proceed like this - not without the US support but without the US intervening." It comes as Israel and Iran continue to trade heavy blows - with no sign of de-escalation in the weeklong battle. Israel's 'Churchill moment' by Katie Davis, Chief Foreign Reporter (Digital) BRITAIN will never be safe until Iran's nuclear scheme is wiped out, Israel's ambassador told The Sun. Tzipi Hotovely said Israel is facing its "Churchill moment" and doing the UK a "huge service" by wiping out the rogue state's efforts to create a nuke weapon. She also rebuked Sir Keir Starmer's calls for de-escalation as she insisted Tel Aviv acted at the "last minute" to save their country from "nuclear holocaust". The PM - who chaired an emergency Cobra meeting this week - has insisted that the UK wants to de-escalate the situation and resolve it through diplomacy. But Amb. Hotovely said Iran had its chance for diplomacy during Donald Trump's 60-day deadline to thrash out a deal over its nuclear programme. And she warned the UK would never be safe until Iran loses any chance of developing a nuke. The diplomat said Israel is facing its "Churchill moment" as Netanyahu finds himself in a similar position as the British wartime leader did in 1940 - drawing the US into a war with its enemy. Speaking to The Sun at its headquarters in London, she said: "When they're calling for de-escalation, you need to understand that the only way to de-escalate the situation is by removing the threat. "As long as Iran will race faster to have its ballistic missile programme that can destroy cities in Israel, if we will let them continue with that, cities in the UK won't be safe." READ THE INTERVIEW HERE European and Iranian officials met yesterday in Geneva, and Trump has said he will allow two weeks for negotiations before deciding whether to strike the rogue nation. Iran's foreign minister Abbas Araghchi made a condition for renewed talks a ceasefire, saying: "There is no room for negotiations with the U.S. until Israeli aggression stops." Talks later on Friday between Araghchi and officials from the EU ended without a breakthrough after four hours. No date was set for the next round of talks, aimed at getting Iran back to the negotiating table with the US. Missiles continued to rain down in Iran and Israel as the talks were held on Friday in a scramble to de-escalate the conflict. Netanyahu has insisted Israel's military operation in Iran would continue for as long as it takes to eliminate the "existential threat" of Iran's nuclear program and arsenal of ballistic missiles. 9 9 Trump will decide within two weeks whether to join Israel's campaign Credit: Getty 9 Smoke pours from Iran's state broadcaster building following an Israeli attack Credit: Reuters 9 Iran's supreme leader Ayatollah Ali Khamenei is refusing to back down Credit: AFP Israel's top general echoed the warning, saying the Israeli military was ready for a prolonged campaign. Iran previously agreed to limit its uranium enrichment and allow international inspectors access to its nuclear sites under a 2015 deal. But after Trump pulled the US unilaterally out of the deal during his first term, Iran began enriching uranium up to 60 per cent a short, technical step away from weapons-grade levels of 90 per cent. Access was also restricted access to its nuclear facilities. Netanyahu signed off a plot to bomb Iran's nuke facilities last week - killing several of its top generals and nuclear scientists, and striking several nuclear facilities. Iran has retaliated by firing 450 missiles and 1,000 drones at Israel, according to Israeli army estimates. Most have been shot down by Israel's multitiered air defenses, but at least 24 people in Israel have been killed and hundreds wounded.

Sky News

2 hours ago

• Sky News

Former Centrica chief Laidlaw in frame to chair embattled BP

Sam Laidlaw, the former boss of Centrica, is among the candidates being considered as the next chairman of BP, Britain's besieged oil and gas exploration giant. Sky News has learnt that Mr Laidlaw is being considered by BP board members as a potential successor to Helge Lund, who announced in April that he would step down. BP's chair search comes with the £62bn oil major in a state of crisis, as industry predators circle and the pace of its strategic transformation being interrogated by shareholders. Elliott Management, the activist investor, snapped up a multibillion pound stake in BP earlier this year and is pushing its chief executive, Murray Auchincloss, to accelerate spending cuts and ditch a string of renewable energy commitments. Mr Lund's departure will come after nearly a quarter of BP's shareholders opposed his re-election at its annual meeting in April - an unusually large protest given that his intention to step down had already been announced. BP's senior independent director - the Aviva chief executive Amanda Blanc - is said to be moving "at pace" to complete the recruitment process. A number of prominent candidates are understood to be in discussions with headhunters advising BP on the search. Mr Laidlaw would be a logical choice to take the role, having transformed Centrica, the owner of British Gas, during his tenure, which ended in 2014. Since then, he has had a long stint - which recently concluded - on the board of miner Rio Tinto, which has been fending off activist calls to abandon its London listing. He also established, and then sold, Neptune Energy, an oil company which was acquired by Italy's Eni for nearly £4bn in 2023. Last December, Mr Laidlaw was appointed chairman of AWE, the government-owned body which oversees Britain's nuclear weapons capability. He also has strong family connections to BP, with his father, Christopher Laidlaw, having served as its deputy chairman during a long business career. One person close to BP said the younger Mr Laidlaw had been approached about chairing the company during its previous recruitment process but had ruled himself out because of his Neptune Energy role. The status of his engagement with BP's search was unclear on Saturday. Another person said to have been approached is Ken MacKenzie, who recently retired as chairman of the mining giant BHP. Mr MacKenzie headed BHP during a period when Elliott held a stake in the company, and is said to have a good working relationship with the investor. Shares in BP have continued their downward trajectory over the last year, having fallen by nearly a fifth during that period. The company's valuation slump is reported to have drawn renewed interest in a possible takeover bid, with rivals Shell and ExxonMobil among those said to have "run the numbers" in recent months. Reports of such interest have not elicited any formal response, suggesting that any deal is conceptual at this stage. BP is racing to sell assets including Castrol, its lubricants division, which could command a price of about $8bn.