Softening risk appetite weighs on market

Rising attacks in the Middle East pushed the energy sector higher. AI-related stock selloff weighed on risk appetite across the rest of the complex.

Crude oil pushed higher, as rising hostilities in the Middle East raised concerns of further supply disruptions. A drone attack on Saudi Aramco’s Shaybah field killed two people, as the Yemen-based Houthis continue attacks on the kingdom. The Iran-backed group also claimed responsibility for the attacks on the Saudi port of Yanbu in the past 48 hours. The attacks have prompted the US to evacuate some personnel and family members from American embassies in the country, but have had little impact on oil production so far, although the increasing focus on energy infrastructure points to higher risks of a disruption.

This comes amid attacks from Iran on shipping in the Strait of Hormuz. At least 23 incidents involving ships attacked near Hormuz were logged in the first two weeks of October, according to data from naval groups in the region. Iran’s Islamic Revolutionary Guard Corps said it hit four “violating” oil tankers while transferring cargo in the northern Persian Gulf. These attacks have led to murmurings of a response from the US. The New York Times reported Israel and the US have developed plans for renewed strikes against Iran after the US midterm elections.

This story was originally published by Breakwave Advisors. Read the full story at Breakwave Advisors →