U.S. stock markets dropped over 1% Thursday as oil prices jumped following heightened Middle East tensions. Iran warned it would shut the strategic Strait of Hormuz shipping lane while Israel launched strikes on Beirut and ordered widespread evacuations in southern Lebanon. The Dow Jones fell approximately 500 points as investors fled to safety.
The escalation comes as Israel faces mounting international pressure over its Gaza campaign, which has killed over 70,000 Palestinians since October 2023. Hezbollah and Iranian forces launched attacks on more than 50 Israeli targets, prompting Israel to order residents within 25 miles of Lebanon's border to evacuate north. A UN commission concluded Israel committed genocide in Gaza, adding legal weight to ongoing proceedings.
Iceland and the Netherlands became the latest countries to intervene in South Africa's genocide case against Israel at the International Court of Justice, bringing total participating nations to 18. Oil markets reacted sharply to Iran's threats regarding the Strait of Hormuz, through which roughly 20% of global oil passes. Utility stocks were among the few gainers as investors sought defensive positions.
The conflict's expansion threatens broader regional stability and global energy supplies. Israel submitted its counter-memorial defense to the ICJ Thursday after multiple deadline extensions. Market analysts warn continued escalation could trigger sustained commodity price volatility and further economic uncertainty across international markets.