Oil prices crossed $100 for the first time in 2 months

July 23, 2026 8:37 am, EDT
| Update: July 23, 2026 10:49 am, EDT

NEW YORK – Oil prices are surging again on July 23 as escalating fighting in the Middle East threatens to slow global flows of crude. Meanwhile, Wall Street is sinking with huge declines for two of its most influential stocks, Alphabet and Tesla.

Stocks sank under the pressure of rising oil prices, which increased costs for many businesses and shifted their customers’ dollars to pay higher prices for fuel. The price of a barrel of Brent crude, the international standard, rose 7.2% to $100.88.

Earlier in the morning, it briefly rose above $100 and hit its highest price in two months after attacks on two Saudi oil tankers in the Red Sea. The attacks threaten another route that oil companies use to ship their crude from the Middle East to customers around the world along the Strait of Hormuz.

Underscoring the importance of the sea route to the economy, US President Donald Trump threatened “major military punishment” against Iran-backed Houthi rebels in Yemen if they continue attacking ships.

Just a few weeks ago, the price of a barrel of Brent fell below $72, roughly the same level it was at when the United States attacked Iran to start the war, on hopes that the Strait of Hormuz would be fully reopened to oil tankers.

The rise in oil prices threatens to cause inflation to rise again. This could result in pressure on the Federal Reserve and other central banks to raise interest rates, which would slow the economy and lower the prices of stocks and other investments.

BREAKING: Brent crude oil prices rose above $98 a barrel after Yemen’s Houthis attacked two Saudi Arabian oil tankers. pic.twitter.com/F9e1RqBfA6

– Kobeissi Letter (@KobeissiLetter) 23 July 2026

The S&P 500 fell 0.8% and could be headed for its first back-to-back weekly losses since March. As of 9:35 a.m. Eastern time, the Dow Jones Industrial Average was down 363 points, or 0.7%, and the Nasdaq Composite was 1.6% lower.

The yield on 10-year Treasuries rose to 4.70% from 4.67% at the end of July 22, up from just 3.97% before the war with Iran began. That’s a significant increase, and has already helped push long-term U.S. mortgage rates to their highest level in nearly a year.

Stocks of companies with large fuel bills fell into heavy losses on concerns of higher expenses.

American Airlines lost 9.1%, even though it reported a bigger profit than analysts expected in the spring, something that typically sends the stock price higher. It raised airfares, which helped it offset higher fuel prices.

Southwest Airlines returned 4.2%, even though it reported better-than-expected profit and revenue in the latest quarter. It made more than a profit on every $1 of its revenue during the spring, even with high fuel prices.

One of the heaviest weights on the US stock market was Tesla, which sank 9.8% after Elon Musk’s electric vehicle company reported weaker-than-expected profit in the latest quarter than analysts. Since it is one of the largest stocks in the S&P 500 by market cap, its stock has a greater impact on the index than almost every other stock.

It seems investors are focused on how much more Alphabet has said it is willing to spend on AI investments. CEO Sundar Pichai said AI demand helped push cloud revenue growth to 82% last quarter, but investors are still uneasy about whether the billions of dollars Alphabet is pouring into the technology will pay off in terms of productivity and profits.

In stock markets abroad, indices in Europe fell sharply as oil prices surged. France’s CAC 40 fell 1.7% in a big loss.

Indices were stronger in Asia early in the day, where South Korea’s Kospi jumped 4.4%.

AP Business Writers Matt Ott and Ellen Kurtenbach contributed to this report.