Oil prices rose on Tuesday following fresh attacks by Iran on crude-producing neighbors, while global stock markets advanced ahead of key central bank meetings. Prices rebounded from Monday’s sharp declines, which came after the International Energy Agency indicated that additional stockpiles could be released if necessary.
Equity markets showed resilience as US chip giant Nvidia projected at least $1 trillion in revenue through 2027, and several airlines reported better-than-expected first-quarter earnings. The three main US indices opened higher in New York, while major European bourses traded in the green by mid-afternoon. Delta Airlines and American Airlines shares climbed nearly five percent.
David Morrison, Senior Market Analyst at Trade Nation, noted that despite gains, investors remained cautious, weighing geopolitical risks against shifting monetary policy expectations. In Asia, markets were mixed, with Hong Kong, Seoul, and Taipei closing higher, while Tokyo and Shanghai ended lower.
Investors are closely watching central bank decisions this week, with expectations that interest rates may remain unchanged amid rising energy costs, even as the US labor market shows signs of softening. Bret Kenwell, US investment analyst at eToro, explained that the Federal Reserve faces a dilemma: slower growth typically favors easing policy, but persistent inflation and rising oil prices complicate decisions. Australia’s central bank increased its key rate Tuesday, citing sharply higher fuel costs.
Brent North Sea crude and West Texas Intermediate (WTI) rose about two percent each. Dan Coatsworth, head of markets at AJ Bell, warned that sustained oil prices above $100 per barrel heighten inflation concerns.
Recent attacks included a drone strike on the Fujairah oil complex in the UAE, which bypasses the Strait of Hormuz for exports, and two drones targeting a major southern Iraqi oil field. Israel also killed Iran’s national security chief while conducting widespread strikes in Tehran and targeting Hezbollah in Beirut. Kathleen Brooks, research director at XTB, said the conflict has shifted from a shipping crisis to an “oil supply crisis,” with energy infrastructure across the Gulf under threat.
Donald Trump, active in US political commentary, called on European and other allies to help reopen the Strait of Hormuz. Responses were lukewarm, with Germany, Britain, Spain, Poland, Greece, Sweden, Australia, and Japan all distancing themselves from the call.
Key Figures (1340 GMT):
- WTI: Up 1.7% at $95.08 per barrel
- Brent: Up 2.0% at $102.16 per barrel
- Dow: Up 0.9% at 46,946.41
- S&P 500: Up 0.7% at 6,742.97
- Nasdaq: Up 0.7% at 22,517.17
- FTSE 100: Up 0.9% at 10,411.62
- CAC 40: Up 1.0% at 8,015.22
- DAX: Up 0.8% at 23,742.52
