Oil Prices Surge 5% After US-Saudi Strikes on Iran-Linked Targets in Iraq

TLDR

• Oil prices rose more than 5% after the US and Saudi Arabia carried out joint strikes on Iran-linked targets in Iraq.
• Iran’s IRGC said it fired ballistic missiles at US forces, but CENTCOM reported all missiles were intercepted.
• Bitcoin dropped to trade near $63,620 as tensions in the Middle East increased.
• Trading volume for Bitcoin fell 16% in 24 hours as investors waited for the US Fed rate decision.
• South Korea’s KOSPI stock market fell another 12%, now down 35% for the month.

Oil prices jumped more than 5% on Wednesday. The rise came after the United States and Saudi Arabia carried out joint strikes on Iran-linked militant groups in Iraq.

Crude oil futures are now trading above $82 per barrel. This follows an escalation in tension between the US and Iran.

US and Saudi Forces Strike Iran-Linked Sites

US CENTCOM confirmed that American and Saudi Arabian forces conducted joint precision strikes in eastern Iraq. The targets included weapons and logistics sites tied to Iran-backed militia groups.

This was the first time CENTCOM has publicly announced a joint operation of this kind with Saudi Arabia. The strikes were a response to more than 30 drone attacks over the past three days.

Those drone attacks targeted US forces and Saudi energy sites in Iraq. The attacks came from a militia group directed by Iran’s IRGC.

The strikes happened during a pause meant to allow diplomatic talks between the US and Iran. Those talks were aimed at easing conflict over the Strait of Hormuz.

Iran’s IRGC said it launched a separate attack using multiple ballistic missiles at US forces. The missiles were fired at Muwaffaq Salti Air Base in Jordan.

CENTCOM said all of the missiles were intercepted. No US casualties were reported from the missile attack.

Iran denied any connection to the drone strikes on Saudi oil facilities. Houthi forces in Yemen criticized the US and Saudi strikes on militia sites in Iraq.

Iran also rejected a proposal from Oman for shared control of the Strait of Hormuz. Iran is asking for more control over the waterway than the 50-50 split that was offered.

Bitcoin Price Reacts to Rising Tensions

Bitcoin fell slightly as oil prices climbed. The token is now trading near $63,620.

Bitcoin hit a 24-hour low of $62,714 and a high of $64,105. Trading volume dropped 16% over the same period.

The drop in trading suggests investors are being cautious. Many are waiting for the US Federal Reserve’s rate decision.

More than three Fed officials have reportedly dissented on recent policy views. Some analysts say this could point to a rate hike in September.

The US dollar index fell to 101.27. This drop helped limit how far Bitcoin’s price fell.

The 10-year Treasury yield held steady near 4.61%. That is close to an 18-month high reached last week.

Stock markets outside the US also felt pressure. South Korea’s KOSPI index fell another 12% as a global chip stock selloff continued.

The KOSPI is now down 35% for the month. This adds to broader concern about stock market stability during the Middle East conflict.

Bitcoin futures open interest fell 0.22% to $47.24 billion over the past day. Still, open interest on CME and Binance rose by more than 1.40% and 0.50%.

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