Oil Prices Surge After US Strike Kills Iranian General

Business

January 3rd, 8:02am

Asharq Al-Awsat

Supplied via AFP

Oil prices soared more than four percent Friday following news that the US had killed a top Iranian general, fanning fresh fears of a conflict in the crude-rich region, with Tehran warning of retaliation. The head of Iran's Quds Force, Qasem Soleimani, was hit in an attack on Baghdad's international airport early Friday, AFP reported. Brent surged 4.4 percent to $69.16 and WTI jumped 4.3 percent to $63.84 as investors grow increasingly worried about the effects of a possible flare-up in the tinderbox Middle East on supplies of the commodity. Both contracts later pared the gains but remained well up. The crisis also comes as tensions between the US and North Korea worsen, with Kim Jong Un declaring a self-imposed moratorium on nuclear and intercontinental ballistic missile tests had ended, with US talks going nowhere. "We are waking up to a less safe world than it was only hours ago, especially if we combine this with simmering tension in the Korean peninsula," said AxiTrader's Stephen Innes. The drama sent investors rushing for the hills and safe-haven units rallied with the yen up 0.7 percent against the dollar and gold climbing 1.4 percent towards $1,600 and a near seven-year high. High-risk currencies retreated against the greenback, with South Korea's won down 0.6 percent, Australia's dollar off 0.4 percent and the South African rand down more than one percent. Equities were mixed, having been rallying for the second day of the year on China-US trade optimism. Regional energy firms were the big winners, with Santos surging more than two percent in Sydney and while Hong Kong-listed PetroChina climbed more than three percent. "Investors are worried that the situation in Iran will worsen, since there could be some retaliation," said Steven Leung at Mizuho Bank, according to AFP. "People will want to cut risk ahead of the weekend. Stocks have rallied a lot in the past month or so, so any bad news flow is a reason to take profit."

from Asharq AL-awsat https://aawsat.com/english/home/article/2064451/oil-prices-surge-after-us-strike-kills-iranian-general