Crude oil futures fell 2% on Thursday, as anxiety about the U.S. economy overshadowed red-hot tensions in the Middle East.
The manufacturing sector contracted in July for a fourth consecutive month and jobless claims surged last week, renewing fears that the U.S. economy could tip into a recession.
Here are Thursday’s closing energy prices:
- West Texas Intermediate September contract: $76.31 per barrel, down $1.60, or 2.05%. Year to date, U.S. crude oil has gained 6.5%.
- Brent October contract: $79.52 per barrel, down $1.32, or 1.63%. Year to date, the global benchmark has gained 3.2%.
- RBOB Gasoline September contract: $2.39 per gallon, down 4 cents, or 1.82% Year to date, gasoline is up 14%.
- Natural Gas September contract: $1.96 per thousand cubic feet, down 6 cents, or 3.34%. Year to date, gas is down 21.7%.
Oil prices had rallied Wednesday after the assassination of Hamas political leader Ismail Haniyeh in Tehran, Iran heightened the risk of a regional war in the Middle East.
Iranian Supreme Leader Ayatollah Ali Khamenei has ordered a direct strike on Israel in response to the killing of Haniyeh, three Iranian officials told The New York Times.
Khamenei ordered the direct strike at an emergency meeting of Iran’s national security council Wednesday morning after the Hamas leader was assassinated, the officials told the Times.
Top Iranian officials are scheduled to meet Thursday with representatives of Yemen’s Houthis, Lebanon’s Hezbollah and militant groups in Iraq, five sources told Reuters.
“The assassination of the Hamas political leader Ismail Haniyeh overnight in Tehran moves this conflict appreciably up the escalatory ladder and edges the region closer to a wider war,” Helima Croft, head of global commodity strategy at RBC Capital Markets, told clients in a note Wednesday.
Iran and Israel traded direct strikes in April, pushing oil prices to the highest point of the year, but the enemies ultimately pulled back from a full-scale war.
“At the time of writing, we are not certain whether the same containment dynamics will prevail, especially given that this current chapter involves Hamas, Hezbollah, as well as Iran,” Croft wrote.
“At a minimum, the ongoing Gaza ceasefire talks appear to be severely imperiled,” she said.
