Asian Stocks Plummet Amid Oil Price Surge
Asian stocks plummeted on July 24 as oil prices surged past $100 a barrel amid escalating tensions in the Gulf, reviving concerns about inflation. Brent crude held at $100.85 per barrel after rising by 7% overnight to its highest level in two months.
The price spike was triggered by attacks from Iran-aligned Houthis on Saudi tankers in the Red Sea, which closed off a crucial Middle East artery for global oil supplies alongside Iran's near-blockade of the Strait of Hormuz. The US military launched air strikes on Iran earlier that day, and Tehran fired at neighboring Arab countries hosting US bases.
Nigel Green, chief executive of deVere Group, said: 'Two of the world's busiest shipping corridors are under threat in the same month, and markets are only just beginning to work out what that means.' He warned that this could lead to a reversal of the inflation drop that gave the US Federal Reserve room to relax.
Higher tariffs on goods from 60 trading partners announced by the US administration also contributed to inflation worries. Markets now expect central banks to become more hawkish, with a one-in-three chance of a rate hike from the Fed as soon as next week.