Oil prices rose and stock futures were little changed on Sunday evening after a weekend of fighting between the United States and Iran that left at least three American service members dead in Jordan and Iraq.
The United States has also begun sending more warplanes to the Middle East, signaling that the war may soon ratchet up further, an ominous sign for both oil and stock markets.
Not only has shipping through the Strait of Hormuz dropped off considerably, but regional energy infrastructure is again being targeted. Iran in recent days has damaged several sites in Kuwait, including oil and power facilities and water desalination plants. The United States, for its part, has expanded its attacks to include Iranian bridges and other critical infrastructure.
The conflict is widening at a vulnerable time for energy markets. Oil stockpiles are now smaller than they were when U.S.-Israeli strikes on Iran began at the end of February, and Ukrainian attacks have severely damaged Russian refineries, tightening supplies of transportation fuels like diesel.
Oil is up.
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The price of Brent crude, the global benchmark for oil, opened roughly 3 percent higher, topping $90 a barrel.
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West Texas Intermediate crude, the U.S. benchmark, experienced similar gains, trading around $84 a barrel.
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Investors and analysts are focused on several factors that will inform the trajectory of oil prices. They include how many ships are passing through the Strait of Hormuz, the narrow waterway between Iran and Oman; how much oil China is buying; and how badly Ukraine damages refineries and other oil infrastructure in Russia, typically one of the world’s biggest diesel exporters.
Stocks are essentially flat.
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Futures on the S&P 500 pointed to little change in prices when markets reopen in the United States on Monday.
Gasoline prices slowly rise.
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Gas prices rose slightly on Sunday, to a national average just shy of $4 a gallon, according to the AAA motor club. The increase has raised the cost for drivers by 34 percent since the war began.
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Gas prices don’t move in lock step with crude, usually trailing increases or drops by a few days. Fuel markets are especially strained right now because so many of the world’s refineries are offline or producing less after sustaining damage, including in the Persian Gulf and Russia.
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The average price of diesel also gained slightly, rising to $5.10 a gallon on Sunday, up almost 36 percent since the start of the war.
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