Middle East Conflict Sends Oil Prices Soaring to $105 a Barrel
The conflict in the Middle East has sent shockwaves through global markets, causing oil and gas prices to surge. The price of Brent crude has jumped above $100 a barrel, while natural gas costs have soared on wholesale markets. In the UK, the price of natural gas rose above 200p per therm for the first time since the end of 2022.
The closure of the Strait of Hormuz due to the conflict has led to supply disruptions and price hikes. Storage levels in Europe are lower than normal for this time of year, exacerbating the price increase. The need to fill reserves ahead of winter has also contributed to the rise in prices.
President Trump said he did not think the fighting would end until after the US mid-term elections in November. This statement has fueled concerns about higher inflation and its potential impact on bond yields. In the UK, bond yields have risen to their highest level in decades.