Rather, it is geopolitical factors—specifically, escalating tensions in the Middle East—that are unsettling markets and pushing prices higher.

A sustained surge in oil prices is likely to complicate the U.S. fight against inflation. A $10-a-barrel increase would boost year-over-year growth in the consumer-price index by 0.5 percentage points,

Oil prices leapt, and stocks fell on worries that escalating violence following Israel's attack on Iranian nuclear and military targets could damage the flow of crude around the world, along with the global economy.

Diamondback Energy stock rose 5% and Occidental Petroleum rose nearly 5% as a swathe of energy-related stocks reacted to a jump in crude prices after Israel's attack on Iran. Conoco-Phillips' stock rose 4%, ExxonMobil rose 3% and Chevron gained 2.7%.

WASHINGTON (Reuters) -U.S. President Donald Trump expressed frustration on Thursday that oil prices have risen amid supply concerns from potential conflict in the Middle East. Both global and U.S. oil prices surged more than 4% on Wednesday to their highest levels since early April before easing a bit on Thursday.

Oil surged, stocks fell and investors sought safety in the U.S. dollar and government bonds after Israel struck Iranian nuclear and military targets in an attack that raised the risk of all-out war between them.

Oil prices rose more than 9 percent and the Asian stock market dived on Friday morning after Israel launched attacks on Iran. Brent surged to $78 a barrel in the biggest intraday gain since March 2022,