Global markets turmoil intensifies on Iran war

Energy prices surged on Tuesday, sending stocks tumbling and the dollar rising as investors worried about inflation and the inability of central banks to help with interest rate cuts.

World oil prices soared around nine percent and European natural gas prices rocketed for a second day running as the war disrupted Middle East exports.

Brent North Sea crude, the international benchmark, topped $85 a barrel for the first time since July 2024.

The US and Israeli attacks on Iran and its retaliation across the region have upended regional energy flows, with the crucial Strait of Hormuz — through which about a fifth of global oil transits — effectively closed off.

The war has also fuelled fears of a fresh energy crisis that could ramp up inflation.

“The higher energy costs are fueling inflation concerns, pushing out rate cut expectations for some and increasing rate hike possibilities for others, while also raising earnings concerns that stem from higher operating costs and a potential slowdown in consumer spending,” said Briefing.com analyst Patrick O’Hare.

Wall Street’s main indices opened sharply lower, with the tech-heavy Nasdaq Composite dropping two percent.

European markets were hit even harder with losses of three per cent and more.

“European markets are being hit hard as the full inflationary impact of the war in Iran truly comes home to roost,” said Joshua Mahony, chief market analyst at Scope Markets.

Data showed an unexpected rise in eurozone core inflation, adding to concerns.

Forex.com analyst Fawad........

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