Crude prices jump over 7% after Houthi attacks on Saudi tankers, fueling inflation fears and Fed rate hike bets.
U.S. equities fell sharply Thursday as Brent crude topped $100 a barrel for the first time since last month’s Iran-U.S. truce. The Dow Jones Industrial Average dropped 458 points, or 0.9%, while the S&P 500 and Nasdaq lost 1.2% and 2.2%, respectively.
The spike in oil prices followed Houthi strikes on two Saudi oil tankers in the Red Sea, raising concerns over escalating regional conflict. West Texas Intermediate crude climbed 6.5% to $92 a barrel, its highest level since early 2025. Treasury yields surged, with the 10-year yield hitting 4.7%, its highest since January 2025.
Markets now price an 82% chance of a Federal Reserve rate hike in September, up from 52% a week ago, as rising energy costs stoke inflation worries.