Oil prices are climbing back toward $100 per barrel Thursday, while stock markets worldwide slow following their big gains from the day before.
The S&P 500 slipped 0.22% as the United States, Iran and Israel disagreed on the details of their two-week ceasefire, whose announcement had sent markets flying in optimism on Wednesday. The Dow Jones Industrial Average was down 0.30%, as of 10:42 a.m. Eastern time, and the Nasdaq composite was 0.35% lower.
The oil market was jumpier, and the price for a barrel of benchmark U.S. crude oil climbed 6.8% to $100.79. It rose after semiofficial news agencies in Iran suggested forces have mined the Strait of Hormuz, the narrow waterway that has been at the center of President Donald Trump’s demands of Iran. Blockages there have kept oil and natural gas stuck in the Persian Gulf, away from customers worldwide.
Brent crude, the international standard, rose 3.7% to $98.24 per barrel. It’s well below the $119 level that it briefly reached when worries about the war reached their height, but it’s still well above its roughly $70 level from before the war.
Given how far apart the United States and Iran seem to be in their demands, upward pressure on oil prices may be “here to stay for a while” according to strategists at Macquarie led by Thierry Wizman.
Risks remain for renewed fighting, which could cause customers worldwide to hoard whatever oil supplies they do get. That could itself keep oil off the market, much like actual fighting targeting pipelines or oil tankers.
A March 23, 2026 scenario analysis from Fitch Ratings warns that a prolonged disruption of the Strait of Hormuz could push oil prices sharply higher and keep them elevated into next year.
Fitch estimates that if the critical shipping lane remains constrained, crude could average around $100 per barrel or more through 2026, with more severe scenarios driving prices toward $120.
The outlook reflects the outsized importance of Hormuz, a narrow corridor that carries roughly one-fifth of global oil supply. Any sustained interruption would remove significant volumes from the market, tightening global inventories and forcing refiners to compete for alternative barrels that are often more costly and harder to access.
Analysts say the impact would likely extend beyond a short-term spike, embedding a lasting geopolitical risk premium in oil prices. Even with partial rerouting, limited spare capacity globally means supply-demand imbalances could persist, keeping energy costs elevated and adding to inflationary pressure worldwide.
On Wall Street, a suite of mixed reports on the U.S. economy Thursday helped to keep Wall Street in check. One said an underlying measure of inflation that the Federal Reserve considers important — the Personal Consumption Expenditures — at 2.8% in February was on par with January but slightly hotter than economists expected.
PCE inflation had decelerated before the war with Iran began, but not by as much as economists expected.
A separate report said that more U.S. workers applied for unemployment benefits last week than economists expected. The number was not very high compared with history, but it could indicate an acceleration in layoffs.
Treasury yields swiveled up and down in the bond market following the reports before ticking higher.
The yield on the 10-year Treasury rose to 4.31% from 4.29% late Wednesday. Its leap from 3.97% before the war began has sent rates up for mortgages and other kinds of loans going to U.S. households and businesses.
If oil prices stay high and keep upward pressure on inflation, the Federal Reserve would have difficulty resuming its cuts to interest rates to help the slowing economy, even if the job market weakens. A growing number of Fed officials seem to be considering the possibility of a hike in rates, according to minutes of their latest meeting released on Wednesday.
In stock markets abroad, South Korea’s Kospi fell 1.6%, and Germany’s DAX lost 1.4% for two of the world’s biggest moves.
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