Iran Strikes Spark Global Market Turmoil as Oil Prices Soar
US and Israeli strikes on Iran's Supreme Leader Ayatollah Ali Khamenei have sent shockwaves through global markets, with US stock futures declining early Monday amid escalating tensions in the Middle East.
The joint military operation led to a surge in crude oil prices, with WTI crude futures maturing in April rising 7.5% to $72 per barrel and Brent crude futures maturing in May gaining 8% to $78.7 per barrel.
Defense stocks such as Lockheed Martin (LMT), RTX (RTX), Northrop Grumman, Exxon Mobil (XOM), Chevron, and Battalion Oil (BATL) saw significant gains on Monday, ranging from 5% to 85%, while Berkshire Hathaway's shares fell about 2% pre-market after missing Wall Street earnings expectations.
Analysts at ING Think noted that the closure of the Strait of Hormuz would fuel an increase in global oil prices, exacerbating the current cost-of-living crisis and complicating the Federal Reserve's future monetary policy path.