Oil Price Surge Sends Stocks Reeling Amid Escalating Iran War
The US-Iran war escalation has sent shockwaves through Wall Street, with stocks plummeting as oil prices surged back above $100 a barrel.
The S&P 500 index fell 0.5%, while the Dow Jones Industrial Average dropped 0.8% and the Nasdaq composite gave up 0.6%. The losses were broad, with retailers among the companies that pulled the market lower, but energy sector stocks like Exxon Mobil and Chevron rose as oil prices climbed.
The price of Brent crude, the international standard, jumped 3.4% to settle at $101.21 a barrel, its highest point since July. The Iran war is likely to keep oil prices elevated through the US midterm elections in November, according to President Donald Trump.
The sharp increase in oil prices has fueled already high inflation, with gasoline prices in the US up about 32% from a year ago to $4.22 per gallon. Higher fuel prices cut into household budgets directly and also raise shipping costs, further contributing to inflation.