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    Global Markets Dip as Traders Gauge Fallout From U.S. Strikes on Iran

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    Any disruption to traffic in the Strait of Hormuz would have significant economic effects, especially for Asian nations dependent on oil from the Middle East.Stocks edged lower and oil prices climbed in Monday trading in Asia, reflecting investor concern over potential economic fallout from the U.S. strikes on three Iranian nuclear facilities over the weekend.Futures contracts for the S&P 500, indicating how the index might perform when markets open in New York, slipped by about 0.3 percent. The price of West Texas Intermediate, the benchmark for U.S. crude, gained roughly 3 percent. Gold, a traditional safe-haven asset, also rose.Markets in Asia, the first to open after the strikes in Iran, were down. Stocks in Taipei, Taiwan, fell more than 1 percent. Benchmark indexes in Japan, Hong Kong and South Korea also dipped.Traders were waiting for clearer indications of whether there would be an escalation in conflicts in the Middle East — particularly any moves by Iran to disrupt shipping through the Strait of Hormuz.The Strait of Hormuz is a critical transit point for global oil supplies. Last year, about 20 million barrels of oil were shipped through the waterway each day, representing about 20 percent of the world’s total supply. Most of that oil was bound for Asia.Places like Japan and Taiwan rely on the Middle East for almost all of their crude oil imports, meaning that any disruption to traffic through the strait could inflict a large economic blow. China is the largest purchaser of Iranian oil.Oil prices, hovering around $76 a barrel, are expected to enter the $80 range, but if the risk of Iran blocking the Strait of Hormuz is seen as increasing, they will rise even further, said Takahide Kiuchi, executive economist at Nomura Research Institute. In that case, “the Japanese economy could be exposed to downside risks that exceed those of the Trump tariffs,” he said.Other analysts expect fallout from the U.S. strikes to be relatively short-lived.The oil market is better equipped to respond to shocks than it has been in the past because of spare capacity held by exporters, according to Daniel Hynes, a senior commodity strategist at ANZ Research. Geopolitical events involving producers can have a big impact on oil markets, but in recent years, prices have tended to quickly retreat as risks ease, Mr. Hynes said.Daniel Ives, an analyst at Wedbush Securities, said there could be more volatility in stock movements this week. But, he said, the market may view the Iran threat as “now gone.” In that case, he said, “the worst is now in the rearview mirror.”Joe Rennison More

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      Large Oil Producers Around the Persian Gulf Ramp Up Exports

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      Saudi Arabia and other oil states are rushing to load tankers in case the Israel-Iran fighting spreads to export installations.As fighting between Israel and Iran intensifies, the major oil producers around the Persian Gulf, including Saudi Arabia, have been racing to load tankers with exports, possibly as a hedge against future disruption.These increases are occurring despite jumps in insurance costs and shipping rates and hazards like jamming of navigation systems.Analysts say that these producers are preparing for the possibility that fighting could spread to oil export installations, which have been largely spared so far, or that shipping could be disrupted through the Strait of Hormuz, the narrow passageway from the Persian Gulf through which a large portion of both oil and liquefied natural gas travel.“They want to make sure that they reduce the risks,” said Homayoun Falakshahi, head of crude oil analysis at Kpler, a research firm. “That means export as much as possible, as soon as possible.”Kpler estimated that Saudi Arabia’s oil exports had increased 16 percent through mid-June from the same period in May.Other producers in the region like the United Arab Emirates and Iraq have boosted shipments around 10 percent, Mr. Falakshahi said.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      The Markets Are Balancing on a Knife’s Edge

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      The world has been anything but peaceful, but you wouldn’t know that from looking at the markets.The calm in the markets has been unnerving.You might think the world has been enjoying a season so tranquil that the stock, bond and currency markets have fallen asleep.Yet the world has been anything but peaceful lately, whether in the United States, Ukraine or the Persian Gulf. And the Federal Reserve gave the markets another reason for concern on Wednesday when it held interest rates steady. Jerome H. Powell, the Fed chair, said that the economy faced the risks of both higher inflation and stagnating economic growth, but that the central bank needed more evidence before it could decide where the greatest dangers lay.“Right now, it’s a forecast in a foggy time,” he said. Even more than usual, the path ahead isn’t clear. Still, there was barely any reaction in market prices. Nor has anything else seriously disrupted major markets.That’s noteworthy, when you consider the crises that are looming: the highest tariffs in decades; a contentious crackdown on immigration and a swelling budget deficit in the United States; and, in the Middle East, an escalating war between Israel and Iran that could sharply reduce global oil supplies.This isn’t to say all markets have been entirely placid. The price of oil has oscillated since Israel launched a barrage of air attacks on Iran last Friday, setting off a new, heightened stage of conflict between the two longtime adversaries. President Trump has warned Iran’s supreme leader, Ayatollah Ali Khamenei, that the United States might intervene directly, saying, “Our patience is wearing thin.” The start of a much bigger war, with the United States joining the Israeli effort to eliminate Iran as a potential nuclear threat, would undoubtedly wake the markets from their apparent slumber.High StakesThe economic risks in the Persian Gulf are enormous. If Iran were desperate enough, in addition to targeting U.S. forces in the region it could throttle the oil supplies that pass through the Strait of Hormuz. Shipping through the strait encompasses one quarter of “total global seaborne oil trade,” according to the U.S. Energy Information Administration, and protecting that oil route has been a preoccupation of U.S. military planners since the days of the shah of Iran, who was deposed in 1979.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Two Major Energy Facilities in Tehran Hit in Israeli Strikes

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      Across Iran’s capital, flames and smoke covered the sky.Israel’s latest wave of attacks on Iran took out Tehran’s main gas depot and its central oil refinery in separate parts of the capital, engulfing its sky in smoke and flame early Sunday.The Shahran fuel and gasoline depot, which has at least 11 storage tanks, was hit and set afire during the Israeli attack that began on Saturday night, Iran’s oil ministry said in a statement. Shahran is in an affluent neighborhood of luxury high rises.“The fire is terrifying, it’s massive; there is a lot of commotion here,” said Mostafa Shams, a resident of the area. “It’s the gasoline depots that are exploding one after another, it’s loud and scary.”Separately in the city’s south, Shahr Rey, one of the country’s largest oil refineries, was also struck, according to Iranian state news media. Emergency crews were trying to contain the fire, and a resident of Tehran, Reza Salehi, said he could see the flames from miles away.Israel’s targeting of Iran’s energy facilities, a crucial source of export cash for the country as well as of domestic energy, represented a significant escalation in its military campaign against Tehran.Earlier on Saturday, Israel had struck two key Iranian energy sites, including a section of the South Pars Gas Field, which is one of the world’s largest and critical to Iran’s energy production.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Iran’s Vital Oil Industry Is Vulnerable in an Escalating Conflict

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      The country’s exports mostly come from Kharg Island in the Persian Gulf. But Israel’s energy facilities are also at risk.The conflict between Israel and Iran appeared to be spreading on Saturday to Iran’s energy infrastructure, raising fears about energy supplies from the Middle East.Iran’s oil ministry blamed Israeli drones for attacking part of the South Pars natural gas field, one of the world’s largest, and a refinery, causing fires at both.It is not clear how far Israel intends to go in attacking Iran’s energy facilities, a crucial source of export cash for the country as well as domestic energy that looks particularly vulnerable.“This is a first salvo into energy and a warning shot that Israel is willing to hit Iranian energy infrastructure if Israeli civilians are targeted,” said Richard Bronze, head of geopolitics at Energy Aspects, a research firm.Other Iranian installations are at risk, analysts say.“There is one clear target that would make it very easy if Israel or the United States wanted to impact Iran’s oil exports,” Homayoun Falakshahi, senior analyst for crude oil at Kpler, a research firm, said during a webinar on Friday. “And this is Kharg Island.”Nearly all of Iran’s oil exports leave from tankers at berths around Kharg Island, a small coral land mass in the northern part of the Persian Gulf off the Iranian coast, potentially making it a target in a protracted war, analysts say.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Israel Expands Attack to Include Iran’s Oil and Gas Industry

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      Iran has been battling an acute energy crisis for months because of gas shortages, and repairing any damage would both be costly and take significant time.In a widening of its military campaign against Iran, Israel targeted Iran’s critical energy infrastructure at gas and petrochemical refineries on Saturday, according to a statement from Iran’s oil ministry.The statement said Israeli drones had targeted a section of the South Pars Gas Field in Bushehr Province. South Pars is one of the world’s largest gas fields and a critical part of Iran’s energy production. The Fajr Jam Gas Refining Company was also targeted, the ministry said.Iran is one of the world’s major energy producers. It has the second-largest gas reserves in the world and fourth-largest crude oil reserves.Videos posted to social media and verified by The Times showed a large fire burning at the South Pars gas refinery in Iran’s southern Bushehr Province.The explosions took production lines at both facilities offline, the ministry statement said, even as firefighters and emergency crew had largely contained the blazes.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Oil Prices Surge and Stock Markets Stumble After Israel Strikes Iran

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      The military strikes jolted investors, raising concerns that a broader Mideast conflict would disrupt the world’s energy supplies.Israel’s military strikes against Iran shook global markets, as oil prices surged and stocks tumbled on worries that the attacks could set off a broader Mideast conflict that would disrupt the world’s energy supplies.Prices of Brent crude oil, the international benchmark, jumped nearly 9 percent to almost $78 a barrel in the hour following the Israeli strikes. As investors worried that rising oil prices might lead to more inflation and hurt the economies of oil-importing nations, stock markets fell broadly.The Nikkei 225 Index in Japan fell 1.3 percent in early trading Friday, while the Hang Seng Index dipped 0.7 percent in Hong Kong. Wall Street was closed at the time of the attack, but overnight futures market trading indicated that they could also fall as much as the Tokyo market.Iran is among the world’s largest producers of oil, and it sells almost all of what it produces to China, which consumes 15 percent of the global supply. Sales by Iran’s state oil company to China represent about 6 percent of Iran’s entire economy, and are equal to about half of its entire government’s spending.Iran’s exports have lagged in recent years as international sanctions have limited its ability to modernize its oil extraction and transportation technology.But Iran’s shipments have begun to recover in the past year on strong demand from China, which would be forced buy oil elsewhere if a broader conflict were to interrupt Iranian supplies. Beijing does have a large strategic oil reserve, accumulated through more than a decade of purchases and dispersed among numerous sites across the country. That could allow it to withstand weeks of an interruption in imports without difficulty.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Coal and Gas Plants Kept Open Under Trump’s Energy Emergency

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      The grid operators that draw power from the plants said they never asked for them to remain open, and consumers may have to absorb extra costs.A 63-year-old coal-fired power plant was scheduled to permanently close its doors in Michigan on June 1. So was an oil- and gas-powered plant that was built in the 1960s in Pennsylvania.But at the last minute, the Trump administration ordered both to stay open. The orders came as it pursues a far-reaching plan to boost fossil fuels, including coal, by declaring a national “energy emergency.”The grid operators in Michigan and Pennsylvania said they hadn’t asked for the orders and hadn’t planned on using the plants this summer.The costs to keep the plants open, which could total tens of millions of dollars, are expected to fall on consumers. Experts have said there’s little evidence of a national energy emergency, and 15 states have sued to challenge President Trump’s declaration, which was issued the day he took office.The emergency orders, which came last month, surprised the companies that operate the plants, and they are now scrambling to delay some workers’ retirements and reverse nearly complete plans to shutter their facilities. In Michigan, the plant operator raced to buy enough coal to power operations.The episode marks a highly unusual use of the Energy Department’s emergency powers under the Federal Power Act. In the past, the department has typically issued emergency orders at the request of regional grid operators to stabilize the power supply during extreme weather events and blackouts. More

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      OPEC Plus Members Say They Will Fast-Track Oil Output

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      Saudi Arabia and the United Arab Emirates see a chance to ratchet up production in July, the third consecutive month of accelerated increases.Eight members of the OPEC Plus oil cartel said Saturday that they planned to continue their accelerated increases in production in July, the third consecutive month.The group, including Saudi Arabia and Russia, said in a news release that it was acting “in view of a steady global economic outlook and current healthy market fundamentals.” They pegged the increase at 411,000 barrels a day, although analysts say the actual amount is likely to be less.The move, which was expected, indicates a marked shift in oil policy by Saudi Arabia, the de facto leader of the group.Until recently, the Saudis had kept output at what was for them an uncomfortably low level to bolster oil prices, even though other members of OPEC Plus had exceeded their cap. Saudi Arabia will gain the largest share of the combined increases — boosting its ceiling to about 9.5 million barrels a day.The Saudis and other OPEC Plus members like the United Arab Emirates had chafed because some members including Iraq and Kazakhstan had exceeded their ceilings. The Saudis are now sending a message that they will not restrain output if others don’t.A catalyst for the change, analysts say, is President Trump, who warmly courted Saudi Arabia’s de facto ruler, Mohammed bin Salman, as a commercial and strategic partner.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More