BNY’s Bob Savage notes that WTI and Brent prices are rising for a third day as United States (US)-Iran tensions escalate, with missile and drone attacks in the Gulf region pushing benchmarks toward and above USD 90.
Savage warns that sustained WTI above USD 90 reshapes rate expectations and growth risks, with war and energy dynamics dominating the macro narrative into H2 2026
Gulf tensions fuel crude rally “The third day of oil price rises has left global shares lower and U.S. equity futures weaker. The escalation in the U.S.-Iranian conflict has again been the driving force, pushing bond yields and USD higher. The economic data produced mixed results: China’s services PMI rose to a three-month high, while Australian Q1 GDP was softer than expected.” “Gulf hostilities escalated again overnight, with the U.S. military saying Iranian missile and drone attacks on Bahrain, Kuwait and other regional targets were intercepted, failed or fell short.
U.S. Central Command said missiles aimed at Kuwait broke apart in flight, several ballistic missiles did not reach their targets and three missiles heading for Bahrain were intercepted, while U.S. forces also downed drones and struck Qeshm Island after attempted attacks. Iranian state media said the Revolutionary Guards targeted the U.S.