Jump in oil prices lift energy stocks amid renewed US strikes on Iran
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The news: A sharp overnight spike in oil prices following a renewed round of drone attacks on energy infrastructure in the Middle East has spurred a jump in energy stocks, paving the way for energy to be the top performing sector across the ASX 200 in afternoon trade .
The numbers: Brent crude rose 2.6% to USD72.33 ($104.25) at 1:23pm AEST.
The energy sector had lifted 2.8% as Woodside (+2.6%), Santos (+4.9%), Yancoal (+4%) and Viva Energy (+2.3%) posted gains.
The context: This follows the US launching a massive round of airstrikes inside Iran, targeting more than 80 locations and revoked a key sanctions waiver that had permitted new sales of Iranian oil, collapsing the fragile US-Iran peace agreement.
The US said the strikes were a direct response to Iranian attacks on commercial shipping in the Strait of Hormuz, which included overnight drone hits on a Qatari LNG tanker and a Saudi crude tanker.
It remained unclear if Iran would retaliate, but Axios reported that the country’s military had carried out drone assaults on Bahrain citing a US government official. The sudden crude market rebound threatens to rekindle inflationary concerns in global markets, according to Bloomberg.
