Oil climbs on Hormuz attacks as Asian, European stocks fall

Oil prices climbed on Wednesday, Oct. 7, and Brent crude went back above $100 a barrel. Three things drove the move: Iran stepped up attacks on tankers in the Strait of Hormuz, Yemen's Houthis struck Saudi Arabia, and a storm moved toward oil-producing regions on the U.S. Gulf Coast. Asian and European shares fell, and so did the euro. U.S. Treasury yields stayed near 24-year highs, and an index of emerging Asian equities had its steepest one-day drop in a week.reuters+3

The selloff came a day after the S&P 500 and Nasdaq Composite both closed at records. Gains in Nvidia ↘ 0.74% led that rally, along with a Financial Times report that SpaceX was looking to raise $40 billion to buy Nvidia chips.afp

Supply fears return

UK Maritime Trade Operations has counted nine attacks in the Strait of Hormuz so far this month, according to AFP. That is half of September's total for the strait and the Persian Gulf combined. The Houthis said they hit Riyadh's King Khalid International Airport, Abha Airport and an air base at Khamis Mushait. Saudi authorities had not confirmed those claims. Confirmed attacks on airports in Jazan and Najran on Monday injured three people. The storm in the Gulf of Mexico is expected to become the first Atlantic hurricane of 2026.investinglive+1

Supply news had been better earlier in the week. Vitol CEO Russell Hardy said about 12 million barrels per day of crude had left the Middle East on tankers over the previous seven to 10 days. "For now, the market remains highly sensitive to headlines and geopolitical risk," said Chris Weston of Pepperstone.afp+1

Stocks and the euro slide

MSCI's world stock index fell 0.28%, and Europe's STOXX 600 lost 0.45%, Reuters reported. Concerns about French public finances returned, pushing the euro down 0.47% to $1.1208. Earlier in the week it had touched a 17-month low. "The magnitude of the move is striking given the 2027 election remains several months away," said Laura Cooper of Nuveen.investing

MSCI's emerging Asia index dropped 0.9%. South Korea's Kospi closed 2% lower ahead of Samsung Electronics' earnings on Thursday. Singapore shares fell to a two-month low, and Malaysian stocks hit their lowest level since December 2025. Japan's Nikkei 225 and Hong Kong's Hang Seng also fell. The Reserve Bank of India raised its benchmark rate by 25 basis points to 5.5%, its first hike in nearly four years.finance.yahoo+2

Yields in focus

The 10-year Treasury yield rose to about 5.31% ahead of a 10-year note auction on Wednesday, with a 30-year auction to follow on Thursday. Investors were also watching the minutes of the Federal Reserve's Sept. 15–16 meeting, released Wednesday afternoon. Traders now price in a 19% chance of a Fed rate hike this month, down from about 50% a week earlier.investing

"Investors aren't fleeing EM Asia outright, but they are hesitant to add risk with the US Federal Reserve's next move on rates still uncertain," said Inki Cho of Exness.thestar