Oil prices surged while stock markets nosedived on Friday following a dramatic Israeli assault on key Iranian nuclear and military sites.
The attack heightened concerns of a broader Middle East war and sent shockwaves through global financial markets.
The Israeli military operation, confirmed by Prime Minister Benjamin Netanyahu, struck multiple high-value targets, including Iran’s uranium enrichment site at Natanz and its ballistic missile infrastructure.
“We struck at the heart of Iran’s nuclear enrichment programme,” Netanyahu stated in a video address. “This operation will continue for as many days as it takes to remove this threat.”
He further claimed that Israeli forces had hit nuclear scientists “working on the Iranian bomb.”
Citing intelligence assessments, Israeli army officials warned that Iran was nearing the “point of no return” in its quest to develop nuclear weapons and could potentially succeed in a short timeframe.
In a fierce response, Iran’s Supreme Leader Ayatollah Ali Khamenei vowed retaliation, warning: “With this crime, the Zionist regime has set itself for a bitter and painful fate and it will definitely receive it.”
Defense Minister Israel Katz earlier cautioned that Israel was bracing for immediate retaliatory strikes, including drone and missile attacks on its territory.
U.S. President Donald Trump expressed concern about the fallout, stating that a “massive conflict” could erupt in the region.
He also feared that Israel’s offensive might derail progress toward a new nuclear agreement with Iran.
“I thought we were close to a pretty good deal,” Trump said, “but this may wreck any chances.”
Although a U.S. official emphasized that the United States had no involvement in the strikes, Iran held Washington accountable.
Tehran’s Foreign Ministry claimed the raids “cannot have been carried out without the coordination and permission” of the U.S. and warned that America would be “responsible for the consequences.”
Oil markets reacted sharply. Brent crude and West Texas Intermediate both surged more than 12% before settling slightly lower after Iranian officials clarified that major refineries and fuel depots were unharmed.
Nonetheless, prices still rose over 5%, with WTI hitting $71.75 and Brent climbing to $73.11 per barrel.
Stephen Innes of SPI Asset Management said the global economy is now at a tipping point. “The Middle East powder keg just blew the lid off global markets,” he remarked.
“Equity futures are plummeting. Bond yields are sinking. Gold and oil are skyrocketing.”
Gold spiked above $3,400 an ounce, while equity indices from Tokyo to London saw significant losses. The Nikkei 225 fell 0.9%, Hong Kong’s Hang Seng dropped 0.6%, and the FTSE 100 slipped 0.5%.
JPMorgan Chase recently projected that crude prices could exceed $130 in a worst-case scenario.
These fears have been intensified by Trump’s renewed threats of a trade war, saying he intends to notify foreign governments of new unilateral tariffs on exports to the U.S.