Oil Prices Rise Amid Middle East Tensions and Inflation Fears
Oil prices continued their upward trend on Thursday, fueled by rising tensions in the Middle East and concerns over inflation. The European Central Bank's decision to raise interest rates is expected today, with ECB chief Christine Lagarde set to provide insight into the prospect for further hikes.
The Strait of Hormuz has seen increased hostilities between the US and Iran, while Saudi Arabia is entangled in a conflict with Yemeni rebels over control of the Bab al-Mandab strait. The resulting uncertainty has driven up oil prices, with Brent North Sea crude trading near $102 a barrel.
Patrick Munnelly, a market strategist at Tickmill Group, noted that global equity markets have moved onto the defensive due to 'inflation anxiety.' This sentiment is reflected in rising government bond yields and concerns over countries' debt piles.