Oil prices soar and stocks plunge due to Israel's attack on Iran.
Brent crude oil prices could peak if traffic through the Strait of Hormuz is disrupted.
MadridIsrael's attack on Iran early Friday morning did not go unnoticed by oil or the stock markets, as is typical whenever the conflict in the Middle East escalates. The price of a barrel of Brent crude oil soared by more than 10%, and the main European markets opened Friday's session with declines, which consolidated at the end of the session. European markets closed down around 1%. In contrast, gold hit monthly highs because investors see it as a safe haven.
Specifically, the price of Brent crude oil, the benchmark for Europe, began by rising 13%, leaving its cost at its highest level since January (to $78.53). As for West Texas Intermediate (WTI) crude oil, the benchmark for the United States, it soared by as much as 14%, surpassing $77.58. Both figures have moderated but have added up to an increase of more than 7%.
It should be noted that Iran is one of the main oil producers, pumping 3.3 million barrels of crude oil per day and exports hovering around 1.7 million barrels. Therefore, an escalation of the conflict in the Middle East that directly affects it translates into a direct impact on the oil market, especially due to the fear of a supply disruption.
In addition to Iran's influence in terms of crude oil production, it also plays a key role in the geopolitical arena for control of the Strait of Hormuz, a strategic route for transporting part of the oil from the Persian Gulf and sold worldwide. If the conflict escalates and leads to a blockage of this route, the impact on supply and, therefore, on the price would be immediate and, according to experts, could skyrocket in just a few days.
Uncertainty in the stock markets
European stock markets are also viewing the escalating conflict with concern. In Spain, the Ibex 35 closed down 1.27%, bringing the index below 14,000 points. The Euro Stoxx 50, the benchmark index for the eurozone, fell 1.31% and remained in negative territory after Wall Street opened with a decline of more than 1%, as indicated by futures.
On the other hand, the price of gold has risen to its highest level in 30 days, as investors view this element as a safe haven. With Friday's increase, the metal closes the week with an increase of more than 3.5%, and futures on the US market forecast it to reach nearly $2,449.