Oil surges, stocks sink as US reportedly eyes new Iran strikes

Oil prices soared more than five per cent Thursday following reports that the United States could launch fresh attacks on Iran before next month's midterm elections, risking further supply disruptions.

Brent North Sea crude, the international benchmark, rallied to $105.48 a barrel before paring gains. The main US contract, West Texas Intermediate, reached as high as $92.84 per barrel.

The Atlantic magazine reported that the White House had asked the Pentagon to draw up options for hitting sites in Iran ahead of the congressional midterms on 3 November.

With Donald Trump's Republicans in danger of losing both houses of Congress, an escalation in the US-Iran conflict could put even more pressure on the president, with Americans already battling record-high diesel prices.

But the suggestion is that renewed US attacks could strengthen Trump's position in seeking to bring Tehran to the negotiating table to end the war.

"The planning (for possible fresh strikes) should be seen in the context of efforts to pressure Iran, bring energy prices down, and demonstrate progress in the conflict ahead of the election," said Arne Lohmann Rasmussen, chief analyst at the energy consulting firm Global Risk Management.

Meanwhile Yemen's Houthis targeted Riyadh airport with missiles on Thursday and warned staff at oil facilities in Saudi Arabia to leave to avoid being targeted as hostilities escalate.

The surge in oil prices weighed on stock markets, with Wall Street's main indices moving lower at the opening bell.

In Europe, both Frankfurt and Paris were lower but London added 0.2 per cent as the higher oil price benefited energy majors. Shares in BP rose 3.3 per cent and Shell 3.2 per cent in afternoon trading.

Asia's leading stock markets tracked losses Wednesday on Wall Street, where technology firms pulled back from recent gains.

Shares in Samsung slid as the South Korean titan forecast a huge increase in quarterly profit that nonetheless failed to meet market expectations.

On Wall Street, shares in SpaceX slid 0.9 per cent as trading got under way in New York, following a Financial Times report that Elon Musk's firm is aiming to raise $40 billion in bank loans and debt to further its purchases of AI chips from Nvidia.

The massive fundraising, coming just four months after SpaceX raised $86 billion in the world's biggest IPO, underscored the voracious demand among tech firms for chips to roll out their ambitions surrounding artificial intelligence.

On currency markets, the euro remains near lows last seen in June 2025 on worries about France's high debt levels, which have spooked bond investors.