Oil rises and US stock futures slip as markets react to US strike on Iran nuclear sites
NEW YORK (AP) — The price of oil rose and U.S. stock futures fell as global markets react to the U.S. strike against nuclear targets in Iran.
The price of Brent crude oil, the international standard, rose 2.6% to $79 a barrel. U.S. crude rose 2.6% to $75.76 a barrel.
On Saturday, U.S. forces attacked three Iranian nuclear and military sites, further increasing the stakes in the war between Israel and Iran.
Futures for the S&P 500 and the Dow Jones Industrial Average slipped 0.3%, while Nasdaq futures fell 0.5%. Treasury yields were little changed. The modest moves indicate markets are taking the latest development in stride.
The conflict, which began with an Israeli attack against Iran on June 13, has sent oil prices yo-yoing, which has in turn caused see-saw moves for the U.S. stock market, because of rising and ebbing fears that the war could disrupt the global flow of crude. Iran is a major producer of oil and also sits on the narrow Strait of Hormuz, through which much of the world's crude passes.
An Iran retaliation that included closing off the waterway would be technically difficult to pull off but traders are afraid Iran could severely disrupt transit through it, sending insurance rates spiking and making shippers nervous to move without U.S. Navy escorts
Some analysts think Iran is unlikely to close down the waterway because the country uses it to transport its own crude, mostly to China, and oil is a major source of revenue for the regime.
'It's a scorched earth possibility, a Sherman-burning-Atlanta move,' said Tom Kloza, chief market analyst at Turner Mason & Co. 'It's not probable.'
Kloza thinks oil futures will ease back down after initial fears blow over.
Ed Yardeni, a long-time analyst, agreed, writing in a report that Tehran leaders would likely hold back.
'They aren't crazy,' he wrote in a note to investors Sunday. 'The price of oil should fall and stock markets around the world should climb higher.'
Other experts aren't so sure.
Andy Lipow, a Houston analyst covering oil markets for 45 years, said countries are not always rational actors and that he wouldn't be surprised if Tehran lashed out for political or emotional reasons.
'If the Strait of Hormuz was completely shut down, oil prices would rise to $120 to $130 a barrel,' said Lipow, predicting that that would translate to about $4.50 a gallon at the pump and hurt consumers in other ways.
'It would mean higher prices for all those goods transported by truck, and it would be more difficult for the Fed to lower interest rates.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Wire
43 minutes ago
- Business Wire
Bentley Systems Wins Multiple 2025 Sustainability Delivery Awards
EXTON, Pa.--(BUSINESS WIRE)-- Bentley Systems, Incorporated (Nasdaq: BSY), the infrastructure engineering software company, was recognized across multiple categories at Environment Analyst's 2025 Sustainability Delivery Awards, held earlier this month in Chicago. Bentley received top honors in two award categories and was highly commended in a third, highlighting the company's continued leadership in driving innovation and measurable progress toward meeting global infrastructure sustainability objectives: Digital Innovation Award (Winner): Bentley's Carbon Analysis capabilities in iTwin Experience were recognized for their ability to enable infrastructure engineers to simplify and streamline data collection and carbon reporting, easily visualize and quantify embodied carbon, and rapidly explore alternatives for better designs, saving time and reducing risk on major infrastructure projects. Water Project of the Year (Winner): Together, Bentley and SABESP were recognized for the Integra 4.0 Cultural Transformation Through Digitalization project, which is a landmark initiative accelerating sustainable water infrastructure modernization in Brazil through digital twin technology. Energy Project of the Year (Highly Commended): Bentley, alongside Exo, were honored for the Evergy Power Transmission Structure Stabilization project, an effort that leveraged digital modeling and predictive analytics to enhance energy grid resilience. These recognitions underscore Bentley's commitment and leadership position to advancing sustainability through digital engineering solutions that enable more resilient, efficient, and low-carbon infrastructure. The water and energy projects were previously honored at Bentley's 2024 Year in Infrastructure conference: the SABESP Integra 4.0 program was recognized as a Going Digital Award winner in the Water and Wastewater category by a panel of independent jurors, while the Exo Evergy Power Transmission Structure Stabilization program received Bentley Founders Honors. 'At Bentley, our sustainability vision reflects the urgent need to future-proof global infrastructure,' said Chris Bradshaw, chief sustainability and education officer at Bentley Systems. 'Digital twins are essential for sustainable development, helping users optimally balance environmental, social, and economic outcomes. We're proud to be recognized across several categories in the 2025 Sustainability Delivery Awards and remain committed to delivering solutions that drive real progress toward climate and resilience goals.' The Sustainability Delivery Awards, hosted by Environment Analyst, celebrate innovation, leadership, and tangible progress across global infrastructure. Judged by an independent panel of industry experts, this year's awards brought together leaders and changemakers committed to transforming the infrastructure sector for a more sustainable future. # # # About Bentley Systems Around the world, infrastructure professionals rely on software from Bentley Systems to help them design, build, and operate better and more resilient infrastructure for transportation, water, energy, cities, and more. Founded in 1984 by engineers for engineers, Bentley is the partner of choice for engineering firms and owner-operators worldwide, with software that spans engineering disciplines, industry sectors, and all phases of the infrastructure lifecycle. Through our digital twin solutions, we help infrastructure professionals unlock the value of their data to transform project delivery and asset performance. © 2025 Bentley Systems, Incorporated. Bentley, the Bentley logo, and iTwin are either registered or unregistered trademarks or service marks of Bentley Systems, Incorporated or one of its direct or indirect wholly owned subsidiaries. All other brands and product names are trademarks of their respective owners.
an hour ago
Trump admin live updates: Trump to meet with national security team on Monday
The president has warned Iran not to retaliate after Saturday's U.S. strikes. President Donald Trump on Sunday pushed Republicans to get behind his taxation bill that will fund his agenda as the self-imposed Fourth of July deadline approaches. "Great unity in the Republican Party, perhaps unity like we have never seen before. Now let's get the Great, Big, Beautiful Bill done," Trump wrote on social media. Trump addressed the nation on Saturday night after the U.S. carried out airstrikes on Iran's nuclear facility, which he called "a spectacular military success." 9 minutes ago Trump to meet with national security team on Monday President Donald Trump is scheduled to host a closed meeting with his national security team on Monday as the administration prepares for possible Iranian retaliation following this weekend's U.S. attacks on Tehran's nuclear network. The meeting will take place in the Oval Office at 1 p.m. ET, according to the president's public schedule. -ABC News Michelle Stoddart After Iran strike, Trump sets sights on his 'big, beautiful bill' Following the U.S. military strike on Iran, Trump publicly praised what he called "great unity" within the Republican Party and shifted his focus to the administration's next legislative priority. 'Great unity in the Republican Party, perhaps unity like we have never seen before. Now let's get the Great, Big, Beautiful Bill done,' Trump wrote on social media. 'Our Country is doing GREAT. MAGA!' The post was the president's first public comment since his address to the nation about the Iran attack on Saturday evening. The administration is aiming to pass the president's tax legislation ahead of the self-imposed July Fourth deadline. -ABC News' Kelsey Walsh
CNBC
an hour ago
- CNBC
Iran's parliament approves blocking Strait of Hormuz. Its closure will alienate Tehran further
In major move after U.S. struck Iranian nuclear sites, the country's parliament on Sunday reportedly approved the closure of the Strait of Hormuz, risking alienating its neighbors and trade partners. The decision to close the waterway now rests with the the country's national security council, and it's possibility has raised the specter of higher energy prices and aggravated geopolitical tensions, with Washington calling upon Beijing to prevent the strait's closure. But in all of this, it is Iran that stands to loose the most, which is why the possibility of a closure of the strait is low, experts said, discounting Tehran's rhetoric. Vanda Hari, founder of energy intelligence firm Vanda Insights, told CNBC's "Squawk Box Asia" that the possibility of closure remains "absolutely minimalistic." If Iran blocks the strait, the country risks turning its neighboring oil producing countries into enemies and risks hostilities with them, she said. Furthermore, a closure would also provoke Iran's market in Asia, particularly China, which accounts for a majority of Iranian oil exports. "So very, very little to be achieved, and a lot of self inflicted harm that Iran could do" Hari said. Her view is supported by Andrew Bishop, senior partner and global head of policy research at advisory firm Signum Global Advisors. Iran will not want to antagonize China, he said, adding that disrupting supplies will also "put a target" on the country's own oil production, export infrastructure, and regime "at a time when there is little reason to doubt U.S. and Israeli resolve in being 'trigger-happy'." Clayton Seigle, senior fellow for Energy Security and Climate Change at the Center for Strategic and International Studies said that as China is "very dependent" on oil flows from the Gulf, not just Iran, "its national security interest really would value stabilization of the situation and a de-escalation enabling safe flows of oil and gas through the strait." There are currently there are no indications of threats to commercial shipping passing the waterway, according to the Joint Maritime Information Center. "U.S. associated vessels have successfully transited the Strait of Hormuz without interruption, which is a positive sign for the immediate future." The Strait of Hormuz is the only sea route from the Persian Gulf to the open ocean, and about 20% of the world's oil transits the waterway. The U.S. Energy Information Administration has described it as the "world's most important oil transit chokepoint." "Iran's operations in and around Hormuz are unlikely to be 'all or nothing' – but instead move along a sliding scale from total disruption to none at all," said Signum's Bishop. "The best strategy [for Iran] would be to rattle Hormuz oil flows just enough to hurt the U.S. via moderate upward price movement, but not enough to provoke a major U.S. response against Iran's oil production and export capacity," he added. On Sunday, Patrick De Haan, head of petroleum analysis at GasBuddy, said in a post on X that pump prices in the U.S. could climb to $3.35-$3.50 per gallon in the days ahead, compared to the national average of $3.139 for the week of June 16. Should Iran decide to close the strait, it would likely use small boats for a partial blockade, or for a more complete solution, mine the waterway, according to David Roche, strategist at Quantum Strategy. In a Sunday note, S&P Global Commodity Insights wrote that any Iranian closure of the strait would mean that not only Iran's own exports will be affected, but also those of nearby Gulf nations, such as Saudi Arabia, the United Arab Emirates, Kuwait and Qatar. That would potentially remove over 17 billion barrels of oil from global markets, and affect regional refineries by causing feedstock shortages, the research firm said. The disruption to supply will impact Asia, Europe as well as North America. Besides oil, natural gas flows could also be "severely impacted," S&P said, with Qatar's gas exports of about 77 million metric tons per year potentially unable to reach key markets in Asia and Europe. Qatar's LNG exports represent about 20% of global LNG supply. "Alternative supply routes for Middle Eastern oil and gas are limited, with pipeline capacity insufficient to offset potential maritime disruptions through the Persian Gulf and Red Sea," S&P added. The Commonwealth Bank of Australia pointed out that "there is limited scope to bypass the Strait of Hormuz." Pipelines in Saudi Arabia and the UAE have only a spare capacity of 2.6 million barrels a day between them, while the strait oversees the transport of an estimated 20 million barrels of oil and oil products per day, the bank said in a note. All these present upside risk to energy prices, with Goldman Sachs estimating that the market is pricing in a geopolitical risk premium of $12. If oil flows through the strait were to drop by 50% for one month and then were to remain down by 10% for another 11 months, Brent is forecast to "briefly jump" to a peak of around $110, Goldman said. Brent oil futures currently stand at $78.95 per barrel, while West Texas Intermediate futures were trading at $75.75.
