Oil Prices Rise as US-Iran Tensions Disrupt Strait of Hormuz, AI Stocks Drag Markets Lower

ERBIL (Kurdistan24) – Global oil prices climbed on Monday after renewed fighting between the United States and Iran disrupted shipping through the Strait of Hormuz, while losses in major artificial intelligence-related chip stocks weighed on global equity markets.

Brent crude, the international benchmark, rose 3.2% to $78.46 per barrel after both Washington and Tehran claimed control over the strategic Strait of Hormuz. The ongoing conflict has prevented oil tankers from using the vital waterway to transport crude from the Persian Gulf, raising concerns over global energy supplies and pushing fuel prices higher.

Higher oil prices have also increased fears of inflation, adding pressure on financial markets. The S&P 500 slipped 0.2%, while the Nasdaq Composite fell 0.7% as technology shares declined. The Dow Jones Industrial Average bucked the trend, gaining 127 points, or 0.2%, in early trading.

AI-related semiconductor stocks led the market losses. Micron Technology dropped 6.1%, trimming part of its strong gains this year, as investors questioned whether the rapid growth in demand driven by artificial intelligence can be sustained over the long term.

The selloff spread across Asia, with South Korea's Kospi index plunging 8.9%. Memory chipmaker SK Hynix tumbled 15.4%, its steepest daily decline since its stock began trading in 1997, after a strong U.S. market debut on Friday.

Not all chipmakers declined. Taiwan Semiconductor Manufacturing Co. (TSMC) rose 1% in Taiwan after reporting that its June revenue jumped nearly 68% from a year earlier, while its U.S.-listed shares edged 0.1% higher.

Investors are also turning their attention to the start of the corporate earnings season. Major U.S. banks, including JPMorgan Chase, Bank of America, Citigroup, Goldman Sachs, and Wells Fargo, are scheduled to report quarterly earnings on Tuesday, providing fresh insight into the health of the U.S. economy.