Oil prices hit $105, stocks tumble as Trump weighs Iran strikes

Key Points:

• Oil prices surged sharply amid speculation that President Donald Trump may resume large-scale U.S. military operations against Iran, with Brent crude rising over 5% above $105 per barrel and U.S. crude nearing $93 per barrel.
• The spike in oil prices led to a rise in bond yields, including the 10-year Treasury yield jumping to 5.35%, while stock markets declined, with the S&P 500, Nasdaq, and Russell 2000 all falling.
• No official decision has been made on resuming combat operations in Iran, but any significant military action ahead of the midterm elections could influence voter sentiment and represents a major escalation in the ongoing conflict.
• Iranian attacks have severely reduced shipping traffic through the Strait of Hormuz, a vital oil transit route, contributing to higher oil costs and shipping expenses, with crude carrier rates to Asia reaching $77 million compared to $9.2 million in 2025.
• Elevated crude prices have kept consumer fuel costs high, with national average gas prices at $4.36 per gallon and diesel prices soaring nearly 70% since February, further impacting the economy as the midterm elections approach.