Oil prices rise slightly after initial surge on middle east tensions

Oil prices saw a modest increase following an initial surge after Israel’s military strike on Iran, which heightened concerns of a broader conflict in the Middle East. Brent crude briefly surpassed $90 but later stabilized at $88.62 a barrel, while West Texas Intermediate climbed to $84.10 per barrel. The geopolitical tensions also boosted safe haven assets, with gold reaching a new all-time high and the yen strengthening. The situation remains tense as both nations assess the aftermath of the military actions.However, the initial fears of a wider conflict were quickly quelled. Iranian media reported that the explosions were caused by air defense systems intercepting drones. Tehran further downplayed the incident, indicating no plans for retaliation. This seemingly conciliatory response eased market anxieties, causing oil prices to erase most of their earlier gains.
U.S. Treasury yields fell on Friday, driven by investor movements toward safe-haven assets amid escalating geopolitical tensions following Israel’s strike on Iran and mixed economic signals. Federal Reserve officials, including New York Fed President John Williams, emphasized a cautious approach to interest rate cuts, citing economic strength. This conservative stance, reinforced by robust Philadelphia Fed manufacturing data, contrasts with the growing demand for safer investments as global uncertainties increase.