Oil At $100 On Red Sea Attacks Rattles Markets
Oil topping $100 amid Red Sea attacks is rattling markets, affirms the CEO of one of the world's largest independent financial advisory organisations.
Nigel Green of deVere Group's comments come as Brent crude touched $100.64 a barrel on Thursday, a jump of 7%, after Houthi rebels claimed to have struck two Saudi oil tankers in the Red Sea.
US crude rose to $91.83, up 5.8%. The Bab el-Mandeb Strait, which carries around 7% of global oil supply according to Oxford Economics, is now under direct threat alongside the Strait of Hormuz.
AdvertisementWall Street felt it within minutes, with the S&P 500 and Dow Jones Industrial Average both falling 1% at the open and the Nasdaq Composite down 1.8%.
Gasoline carries significant weight in the monthly inflation data, which means a sustained rise at the pump does not stay confined to household budgets. It flows straight back into the same reading the Fed will be watching on July 29.
Currency markets typically to react quickly to this kind of escalation, often before the underlying picture is fully clear, and safe-haven demand for the dollar has historically picked up once a crisis starts touching physical supply rather than sentiment alone.
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