Oil Prices Soar on Escalating US-Iran Tensions

The escalating conflict in the Gulf has sent shockwaves through global markets, as stocks slid and bond yields rose to new highs.

Fresh US airstrikes on Iranian military targets near the Strait of Hormuz have stoked inflation worries, pushing oil prices to five-week highs. Brent crude futures rose 0.6% to $95.18 a barrel, while Wall Street futures pointed to another weak start after hitting one-month lows in the prior session.

The pan-European STOXX 600 fell 0.3%, with sharper losses in Asia, where South Korea's KOSPI dropped almost 4%. The Nikkei 225 was down 2.9%.

Kiran Ganesh, multi-asset strategist at UBS Global Wealth Management, said the recent increase in energy prices has put additional upward pressure on bond yields, which had already been rising due to fiscal concerns.