“Middle East Tensions Push Oil Prices Higher After Drone Strike in UAE and US Naval Move”

Oil prices climbed sharply on Monday as geopolitical tensions escalated following a drone strike that caused a fire at an Emirati energy facility and the deployment of US warships through the Strait of Hormuz.

Brent crude jumped over five percent after authorities in the UAE confirmed a fire at a Fujairah energy installation, one of the country’s major oil hubs.

The UAE defence ministry later said Iranian drone and missile attacks were targeting its territory, heightening fears of further escalation.

At the same time, the US Navy said its destroyers had entered the Strait of Hormuz as part of an escort mission announced by President Donald Trump.

Iranian state television reported that the Iranian navy fired a cruise missile “warning shot,” while earlier claims from the UAE suggested Iranian drones had targeted an oil tanker.

Iran has effectively restricted movement through the Strait of Hormuz, a vital global shipping route, following US-Israeli strikes that began on February 28, while Washington continues its blockade of Iranian ports.

Despite the unrest, global markets also reacted to strong corporate earnings reports and renewed enthusiasm for artificial intelligence stocks, particularly in the tech sector.

Analyst Ipek Ozkardeskaya of Swissquote said, “optimism that AI continues to mask the pain elsewhere” supported investor sentiment.

Major technology firms including Apple, Google, Microsoft, and Samsung posted strong results, reinforcing the AI-driven market rally.

However, oil-driven inflation concerns weighed on US stocks, with the Nasdaq reversing earlier gains to close lower.

Asian markets saw strong gains, with Seoul and Taipei hitting record levels led by semiconductor companies SK hynix and TSMC.

European indices closed in the red, while US markets ended mixed amid heightened volatility from rising energy prices.

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