Oil prices jumped and stocks fell on Thursday after the United States said it had shot down four Iranian attack drones and carried out airstrikes against a drone control station, marking the second exchange of hostilities in three days between the two countries.
A U.S. official said the drones posed a threat to American forces in the region and to the little commercial shipping still moving through the Strait of Hormuz, a critical transit route for oil and gas tankers.
The latest confrontation renewed doubts about the prospects of a peace deal, despite continued assurances by President Trump and administration officials that an agreement is close.
Oil prices surge.
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The price of Brent crude, the global benchmark for oil, rose nearly 4 percent to about $96 a barrel for August delivery, currently the most heavily traded contract.
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West Texas Intermediate crude, the U.S. benchmark, jumped 4 percent to $92 a barrel for July delivery, currently its most popular contract.
Stocks turn lower.
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Futures on the S&P 500 pointed to a 0.4 percent decline when stocks resume trading in the United States on Thursday.
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Stocks in Asia, where countries import vast quantities of oil and gas, were down across the board. Shares in South Korea fell nearly 5 percent, while stock markets in Hong Kong, Japan and Taiwan were all down about 2 percent.
Gasoline prices pull back.
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Gas prices fell 3 cents on Wednesday to a national average of $4.46 a gallon, according to the AAA motor club. Since the war began, the cost of gas for drivers has risen by 50 percent.
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Gas prices don’t move in lock step with crude, usually trailing increases or drops by a few days.
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The average price of diesel fell slightly to $5.58 on Wednesday, but remains 49 percent higher since the start of the war.
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