Oil hits five-month high amid fears of fresh strikes on Iran

Investors fear the Iran war could drag on, further limiting shipping through the Strait of Hormuz Credit: REUTERS/Stringer

Chris Price-Markets Editor. 

Joe Sledge-Business Reporter 23 October 2026

The price of oil has hit a five-month high amid fears Donald Trump will ramp up strikes in the Middle East following the midterm elections.

Brent crude, the international benchmark, climbed as much as 2.8pc to more than $116 a barrel, pushing down stock markets in the US and Europe.

It followed a New York Times report that the US and Israel had drawn up plans for renewed strikes against Iran after the midterm elections.

Oil has climbed more than 4pc this week, increasing pressure on stock markets at the same time as fears grow about the valuations of AI companies.

European shares fell on Friday, with the FTSE 100 down as much as 0.8pc, the Cac 40 in Paris down 1pc and the Dax in Frankfurt down 1.1pc.

On Wall Street, the Dow Jones Industrial Average fell as much as 1pc, while the S&P 500 and Nasdaq Composite fell at a slower pace than the previous day.

Traders were rattled on Thursday after Jensen Huang, Nvidia’s chief executive, warned that a “scarcity of capital” was hampering the rollout of the technology.

The tech-heavy Nasdaq in New York dropped by 2.6pc on Thursday while the S&P 500 fell 1.2pc on its worst day since July.

Mark Zuckerberg’s Meta was one of the worse hit in the sell-off, as its shares finished trading almost 7pc lower.

Overnight, the sell-off spread into Asian markets. Japan’s Nikkei 225 dropped by as much as 2.3pc and was down more than 4pc on the week.

The Kospi index in South Korea declined as much as 4.1pc on Friday but recovered to be marginally higher as markets closed.

The stock market turmoil led to a jump in safe haven assets like bonds.

The yield on 10-year US Treasury bonds, a benchmark for the cost of borrowing for governments around the world, fell by the largest amount since March 2023.