Oil prices gain on US-Iran tensions
Reuters :
Oil prices pushed higher Thursday on worries that nuclear talks between United States and Iran might not avert a new conflict that could threaten supplies.
On stock markets, a rally across Asia following gains by US tech heavyweights failed to bolster indices in Europe, where traders focussed on a string of corporate results.
The gains for oil extended a surge seen Wednesday, came after the White House warned that Iran would be ‘wise’ to do a deal with the United States.
The US benchmark oil contract West Texas Intermediate was up 2.2 per cent to $66.62 per barrel, after briefly touching its highest level since August.
Brent crude, the international benchmark, climbed 2.0 per cent to $71.76 per barrel.
US president Donald Trump once again hinted at a strike on Tehran on his Truth Social site, with a US military buildup underway in the Middle East.
UN nuclear watchdog Chief Rafael Grossi said there was a ‘step forward’ in talks between Iran and the United States in Geneva but warned that ‘we don’t have much time’.
‘Oil is extending its gains, with Brent crude back above $70 a barrel… as fears of a military confrontation between the US and Iran rattled energy markets,’ said Matt Britzman, senior equity analyst at Hargreaves Lansdown.
‘Nuclear talks between the two sides appear to be going nowhere fast, and the geopolitical premium is clearly back in play,’ he added.
Major European indices were in the red, with shares in plane maker Airbus down six per cent in Paris and Frankfurt after its annual results fell short of analysts’ expectations.
Shares in French carmaker Renault fell six per cent in Paris after it posted higher 2025 sales but warned of slipping profit margins from increased sales of electric and hybrid vehicles.
In London, disappointing earnings from mining giant Rio Tinto and energy group Centrica weighed on the blue-chip FTSE 100 index.
In Asia, Seoul’s Kospi led gains, jumping more than three per cent to a record high as it reopened after the Lunar New Year break, with chip giants Samsung and SK hynix once again the standout performers.
Tokyo also advanced while Hong Kong, Shanghai and Taipei remained closed for the Lunar New Year holiday.
Asian stocks are enjoying a strong start to the year as investors turn to the region’s relatively cheaper tech plays after Wall Street’s AI-fuelled surge over the past two years.
Investors also tempered expectations for more US interest rate cuts as they assessed minutes from the Federal Reserve’s January meeting, which showed policymakers growing concerned about inflation.
Recent strong data on the US economy has suggested that the Fed might not need to cut rates any time soon.
But ‘US futures are pointing higher… suggesting investors may be ready to look past the Fed noise and push on,’ Britzman said.