US stock markets opened sharply lower on Thursday as surging oil prices and uncertainty stemming from the ongoing conflict involving the US, Israel and Iran weighed on investor sentiment.
Shortly after opening bell, the Dow Jones Industrial Average fell 1.1 per cent to 46,879.09. The broader S&P 500 declined 1.0 per cent to 6,706.10, while the tech-heavy Nasdaq Composite dropped 1.3 per cent to 22,426.80.
Energy markets remained volatile as crude prices surged amid fears of supply disruptions in the Middle East. Oil briefly crossed the $100 per barrel mark earlier in the day before retreating slightly by the time US trading began.
International benchmark Brent crude rose 7.9 per cent to $99.23 per barrel, while West Texas Intermediate (WTI) gained 8.1 per cent to $94.33 per barrel.
Market analysts said investors were increasingly worried about the economic implications of the escalating conflict.
“Oil prices and also the uncertainty with respect to when the war will end” is weighing on markets, Adam Sarhan of 50 Park Investments told AFP.
“The reality is that right now based on the facts that we know so far, there’s no end in sight and that’s the problem for investors,” he added.
Energy markets have been under pressure since the US and Israel launched military operations against Iran on February 28.
The crisis intensified after shipping through the Strait of Hormuz, a critical route that carries roughly one-fifth of the world’s energy supplies, face blockages, with the passage reportedly close to being blocked. Iran has also warned ships attempting to pass through the waterway.
The conflict has intensified risks to energy infrastructure across the region. Iran has targeted oil facilities in key Middle Eastern producing countries, while US and Israeli strikes have focused on Iranian energy installations, heightening fears of prolonged disruptions to global oil supplies.
