Brent Oil Nears $100 After Surging 5% Amid Middle East Attacks

Main oil contract Brent North Sea surged toward $100 a barrel on Thursday as Tehran-backed Houthi rebels targeted Red Sea shipping, raising fears that the Middle East war is widening.  

Most Asian stock markets were buoyed by a much-needed bounce for regional tech firms as investor appetite for artificial intelligence (AI) see-saws. 

European markets were weaker, with London, Paris and Frankfurt all falling in midday trading.

The dollar firmed against its main rivals. 

International oil benchmark Brent soared as much as five percent to above $98 a barrel after Houthi rebels claimed to have struck two Saudi oil tankers in the Red Sea. 

Iran vowed to keep striking the region so long as it remains under attack by US strikes.

"Investors are in a wary mood... as fresh jitters of worry about the ongoing energy crunch hit sentiment," said Susannah Streeter, chief investment strategist at Wealth Club.

"With both the Strait of Hormuz and the Red Sea now under increasing pressure, markets are bracing for the possibility that the conflict could disrupt key energy routes, (and) keep oil prices elevated," she added.

The prospect of higher oil prices also raises the prospect of higher inflation and interest-rate hikes, adding to weak sentiment, analysts said. 

London's FTSE 100 index was dragged into the red by a nine-percent drop in Centrica shares as the owner of British Gas laid out plans to cut 1,300 jobs alongside a mixed earnings update.

Paris shed one percent, weighed down by a 15-percent drop in semiconductor group STMicroelectronics as its sales forecasts fell short of expectations. 

French oil and gas giant TotalEnergies jumped three percent after reporting that net profit doubled in the second quarter as the war pushed up energy prices.

Asian traders bought back into beaten-down tech stocks, with Seoul up more than four percent, helped by rallies in chip giants SK hynix and Samsung, while Tokyo was boosted by Advantest and SoftBank.

Hong Kong and Shanghai also rose. 

Investors' appetite for all things AI has been tested in recent months on concern about elevated valuations and as they question when the trillions pumped into the sector will see returns.

An earnings report from Google-parent Alphabet on Wednesday raised fresh concerns as it said it would likely spend as much as $205 billion on AI this year, far more than expected. 

Next week's results from Microsoft, Meta and Amazon will be pored over for their capital spending plans.

Eyes are on Tokyo after the yen hit a fresh four-decade low against the dollar amid concerns over the gap between the Bank of Japan's low interest rates and those in the United States and other big economies.

Rising oil prices and concerns over Japan's economy have added to pressure on the currency.

Key figures around 1100 GMT -

• Brent North Sea Crude: UP 4.8 per cent at $98.60 per barrel
• West Texas Intermediate: UP 4.3 per cent at $90.56 a barrel
• London - FTSE 100: DOWN 0.2 per cent at 10,699.82 points
• Paris - CAC 40: DOWN 1.1 per cent at 8,342.39
• Frankfurt - DAX: DOWN 0.6 per cent at 24,995.03
• Tokyo - Nikkei 225: UP 0.5 per cent at 66,422.60 (close)
• Hong Kong - Hang Seng Index: UP 1.3 per cent at 25,210.81 (close)
• Shanghai - Composite: UP 0.3 per cent at 3,876.78 (close)
• New York - Dow: FLAT at 52,218.58 (close)
• Euro/dollar: DOWN at $1.1405 from $1.1411 on Wednesday
• Pound/dollar: DOWN at $1.3365 from $1.3372 
• Euro/pound: UP at 85.35 pence from 85.33 pence 
• Dollar/yen: UP at 163.38 yen from 163.15

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)