By John Towfighi, CNN
New York (CNN) — The Iran war sent oil futures surging to historic gains this week, while stocks fell sharply in a worldwide selloff.
US stocks closed lower Friday as surging oil prices and weaker-than-expected jobs data added to concerns coursing through markets. The Dow fell 453 points, or 0.95%, recouping some losses after dropping nearly 950 points after the opening bell. The S&P 500 fell 1.33% and the tech-heavy Nasdaq sank 1.59%.
The Dow finished the week lower by 3%, its worst week since April. The S&P 500 sank 2% across the week, its worst since October. Stocks in Europe and Asia suffered steeper losses: Europe’s Stoxx 600 index sank 5.55% this week, while Japan’s Nikkei 225 dropped 5.5%.
Oil prices continued to climb, hitting their highest level since September 2023. US crude surged 12.2%, to $90.90 per barrel, posting its biggest single-day gain since May 2020. Brent crude, the international benchmark, gained 8.5%, to $92.69 per barrel.
US oil and Brent prices surged roughly 36% and 27% this week, respectively, as the conflict with Iran has effectively halted the flow of oil through the Strait of Hormuz and caused disruptions to oil producers in the region. The 36% surge for US oil this week is the biggest weekly increase since WTI futures, the US benchmark, started trading in 1983.
“Investors have gone from complacency to the edge of panic. And we’re about to have a panic moment,” Bob McNally, president of Rapidan Energy Group, told CNN in a phone interview on Friday.
President Donald Trump on Friday said in a post on social media “there will be no deal with Iran” except unconditional surrender.
“The stock market is becoming increasingly vulnerable to turmoil in the Middle East, making the path of least resistance lower,” Craig Johnson, chief market technician at Piper Sandler, said in a note.
US oil had surged as much as 14% Friday, rising above $92 per barrel, but pared gains slightly in the afternoon as the US International Development Financial Corporation announced it would reinsure up to $20 billion in maritime losses resulting from the Middle East conflict.
Wall Street’s fear gauge, the VIX, was up 24% and hit its highest level since April, when markets were roiled by uncertainty about tariffs.
Saad al-Kaabi, Qatar’s energy minister, told the Financial Times that he predicts all Gulf energy exporters will be forced to shut down production, pushing oil prices higher. Higher oil and energy prices could ignite inflation. That’s stoking nerves on Wall Street.
Concerns about energy inflation were paired with nerves about a weaker-than-expected jobs report Friday morning. The US economy lost 92,000 jobs in February and the unemployment rate ticked higher to 4.4%, according to the latest data from the Bureau of Labor Statistics.
“It’s a challenging number for markets to digest with the weakness on one hand and the rise in oil prices on the other,” said Jeff Palma, head of multi-asset and macro research at Cohen & Steers.
“The combination of trade uncertainty an