Oil price rises on war fears as US kills Iran military commander General Qasem Soleiman

Oil prices spiked today War fears gripped the global markets today after the US killed Iran’s most powerful military commander General Qasem Soleimani.

Oil and gold prices soared as traders feared Iran could retaliate after the Middle East country’s leaders vowed to take “severe revenge” over the general’s killing in Iraq.

Brent crude was up 3% at $68 per barrel, its highest point in three months, while US marker West Texas Intermediate jumped 2.8% to $62.88.

As a result BP gained 5.8p at 486p and Shell climbed 26p at 2285p on London’s premier index. On the FTSE 250 Premier Oil was up 4.8p at 104p and Tullow Oil added 2.4p at 62p.

Traders believe oil prices could continue to rise if supply lines in the region are hurt or the Iranians return to attacking US container ships in the Strait of Hormuz. President Trump, who is facing impeachment charges, made no immediate comment but posted a picture of the US flag on Twitter.

Gold prices were also on the charge, up 1% to $1,542 an ounce — a near four-month high — as investors sought safe haven assets.

This led to hefty gains for gold miner Polymetal International, which added 19p at 1211p, while Fresnillo rose 9.4p at 653p and Centamin climbed 3.2p at 129p. The Japanese yen, which is also seen as a haven, strengthened by 0.5% against the dollar. US Treasury yields fell 0.05 percentage points to 1.835%, the lowest level in three weeks.

Heading in the opposite direction were airlines, which could see their costs increase if oil prices keep rising. EasyJet was rooted to the bottom of the market, down 47.5p at 1382p and International Consolidated Airlines, which owns British Airways, fell 16.4p at 620p. Wizz Air also dropped 51p at 3939p and Ryanair lost 0.4 cents at €14.5.

Travel companies were also feeling the brunt of the attack and Tui was off 20.3p at 970.9p, while Intercontinental Hotels tumbled 43p at 5180p.

The attack put the FTSE 100 firmly in the red — down 39.51 points at 7565.02 — undoing yesterday’s optimism for the year ahead. One trader said: “Here I was yesterday talking about how 2020 would be a good one and the FTSE 100 could touch 8000.

“And then — bang! — Trump reveals his latest surprise. I have a funny feeling we could be talking about this for the rest of the year. It’s going to come as a nasty shock […]

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