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What you need to know today
Oil rose slightly after falling more than 11% on Tuesday, as traders expect a group of countries to tap emergency crude reserves to mitigate disruption caused by the war in the Middle East. The sharp drop came despite aggressive rhetoric from US President Donald Trump and Defense Secretary Pete Hegseth about attacking Iran. Hegseth said Tuesday “will be our most intense day of attacks.”
U.S. crude oil and Brent crude fell more than 17% before paring some losses after U.S. Energy Secretary Chris Wright falsely claimed on X Tuesday that the U.S. Navy had escorted a tanker through the Strait of Hormuz. The post was later deleted and White House press secretary Karoline Leavitt confirmed it was incorrect. West Texas Intermediate crude oil was last up 0.35% at $83.76 a barrel, while Brent crude was steady at $87.8 a barrel.
US stocks ended the day mixed as traders weighed the pullback in oil prices against the risk of a further rally. Sentiment was also affected by a CBS News report indicating that Iran could be moving toward deploying mines in the Strait of Hormuz.
U.S. Central Command later said U.S. forces on Tuesday sank several Iranian ships, including 16 minelayers, near the strait, following a post by President Donald Trump saying that if Iran had placed mines in the Strait, “we want them removed IMMEDIATELY!”
Even as the Strait of Hormuz is effectively closed to most of the world’s oil supply, Iran has shipped at least 11.7 million barrels of oil to China through the waterway since the war began, according to TankerTrackers. Maritime intelligence data provider Kpler estimates that around 12 million barrels of crude oil have passed through the strait since the war began.
On the artificial intelligence front, Oracle reported an improvement in its earnings and issued strong guidance, driving its shares up as much as 10% in extended trading. Investors seemed reassured by the software company’s overall success, amid fears about the company’s heavy debt load funding its AI development.
And finally…
How the Iran war and rising energy prices threaten semiconductor demand
A prolonged conflict in the Middle East could affect the semiconductor industry’s access to key materials, while rising costs could hit demand for chips that have been central to the rise of artificial intelligence, analysts have warned.
Semiconductor stocks were caught in the selloff seen in stock markets before President Donald Trump said Monday that the war will end “very soon.”
Memory chip makers SK Hynix and Samsung have been especially hard hit, with more than $200 billion wiped from their combined value since the start of the war, even as both stocks rose sharply on Tuesday.
—Arjun Kharpal
