Oil jumps 2%, bitcoin tumbles as renewed US-Iran tensions shake global markets – Firstpost

Oil prices surged while bitcoin slid to a two-month low on Wednesday as renewed hostilities between the United States and Iran rattled global markets, dashing hopes of a breakthrough in peace negotiations and reviving fears of disruptions to energy supplies through the strategically vital Strait of Hormuz.

US crude futures rose as much as 2 per cent during the session before trimming some gains to trade at $94.62 a barrel, while Brent crude climbed to $96.77 a barrel. The rally came after reports of fresh military exchanges between Washington and Tehran raised concerns about the security of energy shipments through the Gulf, a critical artery for global oil supplies.

The latest escalation follows a week in which both sides had signalled progress toward a tentative agreement aimed at de-escalating tensions. However, the absence of a formal deal and renewed military activity have prompted investors to unwind bets that geopolitical risks in the region would ease anytime soon.

While oil rallied, risk assets came under pressure. Bitcoin fell below $66,500, extending losses to nearly 10 per cent over the past three trading sessions as investors fled volatile assets amid growing uncertainty.

The world’s largest cryptocurrency was also weighed down by industry-specific concerns. Market sentiment deteriorated after wallets linked to the collapsed Mt. Gox exchange moved approximately 10,300 bitcoins, reviving fears that creditors could begin selling a portion of the remaining holdings once distributions resume.

At the same time, US spot bitcoin exchange-traded funds recorded their 11th consecutive day of net outflows, with withdrawals exceeding $3 billion over the period. The streak marks the longest run of ETF outflows this year and has added to downward pressure on prices.

According to Akshat Siddhant, Lead Quant Analyst at Mudrex, bitcoin’s recent decline reflects a combination of macroeconomic uncertainty and weakening institutional demand.

“Bitcoin slipped below the $66,500 level as selling pressure intensified, wiping out much of the recovery seen in recent weeks. Market sentiment weakened further after Mt. Gox-linked wallets moved 10,300 BTC, reviving concerns about potential distribution from the exchange’s remaining holdings,” Siddhant said.

“At the same time, Bitcoin ETFs recorded their 11th consecutive day of outflows worth over $3 billion, marking the longest streak of withdrawals this year”

He added that if the current pressure persists, bitcoin could retest the mid-$50,000 range in the coming weeks. However, a sustained move above $70,500 would signal renewed buying strength and improve the outlook.

The geopolitical tensions also boosted demand for traditional safe-haven assets. The US dollar hovered near the psychologically important 160-yen level, while investors closely monitored incoming economic data for clues on the Federal Reserve’s next policy move.

Despite the broader risk-off mood, artificial intelligence-linked stocks continued to outperform, underscoring the market’s ongoing enthusiasm for companies tied to the AI infrastructure boom.