Oil Price Surge Drives Australian Market to Worst Week Since US-Iran War

The Australian share market is experiencing its worst week since the US-Iran war began, due to surging oil prices that are putting pressure on bond yields and forcing central banks to hike borrowing costs.

The European Central Bank has raised interest rates for the second time in 2026 to combat an inflation rise driven by higher energy costs from the Iran war. ECB officials hope this move will tame rising inflation.

Australia's share market clawed its way back from its worst day in nearly six months, but inflation and interest rate worries still have traders on edge. This marks the third session of losses for Aussie shares, with no end to the downturn in sight.