On Thursday, oil prices surged sharply as escalating geopolitical tensions between the U.S. and Iran pushed crude toward a near-100% year-to-date gain.
Oil Prices Spike Amid Escalating US–Iran Tensions
U.S. West Texas Intermediate crude futures for May climbed 11.93% or 11.94 points to 112.06, while Brent crude climbed 7.99% or 8.08 points to 109.24.
Refined products also saw strong gains, as RBOB gasoline rose 6.07% or 0.1876 points to 3.279 and ULSD heating oil advanced 9.24% or 0.3747 points to 4.4315.
In contrast, natural gas edged lower, slipping 0.43% or 0.012 points to 2.807.
Meanwhile, at the time of writing, U.S. stock futures were largely flat, with Dow futures inching up 1.00 point to 46,733.00, S&P 500 futures gaining 1.50 points (0.02%) to 6,623.75 and Nasdaq futures dipping 0.50 points (0.00%) to 24,217.50.
On Friday, South Korea’s KOSPI rose 2.50% or 130.60 points to 5,364.65, while Japan’s Nikkei 225 gained 1.41% or 739.77 points to 53,203.04.
The U.S. Dollar Index (DXY) was largely flat, slipping 0.01% or 0.006 points to 100.011.
Jim Cramer Notes Market Downturn Pattern
Amid the rally, CNBC host Jim Cramer cautioned that such sharp oil gains have historically coincided with significant equity market declines.
“Oil up 87% for the year… will be hard to contain this decline now that the president gave us a mind-boggling misdirection play,” Cramer said.
He continued saying, “We don’t have any instances of oil being up 100% and the market NOT being down 20%. So here we go again…”
Oil prices are up 95.16% year-to-date and have gained 56.27% over the past year.
Trump Warns Of Iran Strike, Blames Tehran For Surge In Oil Prices
Cramer made the remarks after President Donald Trump warned in a Wednesday evening national address that the U.S. could escalate military action against Iran within the next two to three weeks, dimming hopes for a near-term de-escalation.
In his speech, Trump blamed rising oil prices on what he described as “deranged terror attacks” by the Iranian regime on commercial tankers and neighboring nations.
He said the U.S. would respond “extremely hard” if tensions continue, while maintaining that the conflict would be short-lived and that talks with Tehran are still underway.
Strait Of Hormuz Concerns Drive Supply Shock Fears
A major driver behind the oil spike is the growing uncertainty surrounding the Strait of Hormuz, a critical artery for global crude shipments.
The U.K. has convened foreign ministers from 40 nations to explore ways to reopen the Strait of Hormuz, Al Jazeera reported.
U.K. Foreign Secretary Yvette Cooper said Tehran’s “recklessness” in blocking the route is undermining “global economic security,” as she led the virtual talks on Thursday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo Courtesy: VADZIM SHUBICH on Shutterstock.com
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