Oil prices rose over 2 per cent as fresh US military strikes on Iran intensified regional tensions, prompting a sharp reaction in global energy and financial markets. Brent crude climbed 2.2 per cent to $75.80 per barrel, while US benchmark crude increased 2.1 per cent to $71.94 a barrel, reversing earlier declines. The surge followed President Donald Trump's announcement that the memorandum of understanding with Iran signed the previous month was "over," with Trump describing Iranian leadership as "sick people." The US military carried out new strikes after claiming Iran attacked three vessels in the Strait of Hormuz, though Tehran did not claim responsibility for the ship attacks. Iranian state media reported that Qeshm Island, Bandar Abbas and Sirik were targeted in the US operations. Iran responded by striking American military installations in Bahrain and Kuwait. Parliamentary speaker Mohammad Ghalibaf accused the US of violating the recent agreement, citing breaches including renewed oil sanctions and threats of further attacks. He stated, "The era of bullying and extortion is over. It leads nowhere. We don't fold," in a post on X. Stock markets across Asia and Europe declined, with Japan's Nikkei 225 falling 2.1 per cent to 66,819.05 and South Korea's Kospi dropping 5.4 per cent to 7,246.79. Samsung Electronics and SK Hynix both lost ground, falling 6.3 per cent and 5.7 per cent respectively. In Europe, Germany's DAX dropped 1.1 per cent and France's CAC 40 fell 0.9 per cent. The UK's FTSE 100 declined around 1.2 per cent in morning trading. Hong Kong's Hang Seng rose 3 per cent to 24,193.56, while Shanghai's index dipped 0.5 per cent to 3,970.88. US futures remained largely unchanged. The S&P 500 fell 0.4 per cent to 7,503.85, despite most stocks in the index gaining, as Rivian Automotive dropped 18.1 per cent following its announcement of a 75 million-share sale. The US also reimposed sanctions on Iranian oil exports.
Trump terminated a recently signed agreement with Iran while ordering new military strikes, even though Tehran had not claimed responsibility for attacks on ships. The US then reimposed oil sanctions, contradicting claims of seeking de-escalation. Iran's retaliation against American bases in Bahrain and Kuwait signals a widening conflict. The cycle of action and response risks further destabilising global energy supplies.
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