Oil Soars Again On Mideast Tension

Oil prices shot higher Thursday on fresh supply concerns in the Middle East, while on most markets stocks climbed after the US Federal Reserve's decision to cut interest rates

New York, (UrduPoint / Pakistan Point News - 20th Sep, 2019 ):Oil prices shot higher Thursday on fresh supply concerns in the Middle East, while on most markets stocks climbed after the US Federal Reserve's decision to cut interest rates.

Brent oil jumped nearly 1.3 percent as traders seized on resurfacing tensions in the crude-rich Middle East.

The market had surged at the start of the week after drone attacks on Saudi oil facilities on Saturday.

Traders remain on red alert for further developments, including the US and Saudi response, with both putting the blame at Iran's door.

"There's been a fairly sharp move higher in oil after a couple of incidents occurred in a short space of time that threaten to raise supply fears in the Middle East," XTB analyst David Cheetham told AFP.

"First off, reports that Saudi Arabia will look to import oil to offset its own reduced production suggests that the impact of last weekend's attacks is greater than the kingdom is letting on, with hopes of a swift return to the prior level of output looking hopeful to say the least.

"Not long after this, the Iranian foreign minister tweeted an inflammatory statement aimed at Saudi Arabia and together these have seen a flurry of buying in the oil price," Cheetham added.

- New York sags - The crisis has reignited worries about a military flare-up in the oil-rich Gulf region, which would send prices soaring and likely hit stock markets.

In New York, stocks ended little changed, erasing gains from earlier in the day after a Trump advisor was quoted in Hong Kong media as saying President Donald Trump would continue escalating the US-China trade war if the two sides failed to strike a bargain soon.

Another wave of US tariff increases is scheduled for October 1, with high-level US and Chinese officials also due to resume negotiations early next month.

The Fed on Wednesday lowered benchmark interest rates by a quarter of a percentage point and Fed Chairman Jerome Powell said policymakers would be ready to act aggressively if the world's largest economy began to deteriorate.

In the eurozone, the Frankfurt and Paris stock markets gained on the Fed news and after increases across much of Asia.

London stocks also moved higher after the Bank of England, as expected, held its main interest rate steady at 0.75 percent.

Investors shrugged off official data showing that UK retail sales dipped 0.2 percent in August from July.

"Following the BoE's policy announcement earlier, which was deemed to be more dovish than anticipated, the pound dropped and this helped to lift the FTSE to a fresh high for the week," said market analyst Fawad Razaqzada at Forex.com.

- Key figures around 2030 GMT - New York - Dow: DOWN 0.2 percent at 27,094.79 (close) New York - S&P 500: FLAT at 3,006.79 (close) New York - Nasdaq: UP 0.1 percent at 8,182.88 (close) Brent North Sea crude: UP 80 cents at $64.40 per barrel West Texas Intermediate: UP 2 cents at $58.13 London - FTSE 100: UP 0.6 percent at 7,356.42 points (close) Frankfurt - DAX 30: UP 0.6 percent at 12,457.70 (close) Paris - CAC 40: UP 0.7 percent at 5,659.08 (close) EURO STOXX 50: UP 0.7 percent at 3,552.65 (close) Tokyo - Nikkei 225: UP 0.4 percent at 22,044.45 (close) Hong Kong - Hang Seng: DOWN 1.1 percent at 26,468.95 (close) Shanghai - Composite: UP 0.5 percent at 2,999.28 (close) Euro/dollar: UP at $1.1043 from $1.1030 at 2100 GMT Dollar/yen: DOWN at 108.03 yen from 108.45 yenPound/dollar: UP at $1.2523 from $1.2472Euro/pound: DOWN at 88.12 pence from 88.44 pence