Oil prices surge past $100 while Dow futures drop 900 points as Iran war spirals into worst-case fears and U.S. eyes special forces mission

A little more than a week into the U.S.-Israeli war against Iran, Wall Street has begun accounting for a prolonged conflict, as hopes for a swift resolution have been dashed.

With no signs of reducing tensions, both sides are instead escalating—expanding targets to critical infrastructure and risking more severe retaliation in the process.

U.S. oil futures jumped 17.2% to $106.57 per barrel, while Brent crude rose 15.2% to $106.81. Over the weekend, President Donald Trump from the Strategic Petroleum Reserve to ease price pressure.

“Short-term oil prices—which will drop rapidly once the Iran nuclear threat is eliminated—are a tiny cost for the safety and peace of the U.S. and the world,” he on Sunday.

Gasoline prices are now likely to top $4 per gallon, as oil has surged past $100 a barrel for the first time since 2022. Patrick De Haan, head of petroleum analysis at GasBuddy, that the odds of hitting that threshold in the next month are now 80%.

Futures tied to the Dow Jones Industrial Average plummeted 911 points, or 1.91%. S&P 500 futures fell 1.69%, and Nasdaq futures dropped 1.73%.

Gold declined 1.56% to $5,078 per ounce, while silver fell 3.4% to $81.43. The yield on the 10-year Treasury climbed 5.1 basis points to 4.183% amid expectations of higher inflation. The U.S. dollar gained 0.87% against the euro and 0.37% against the yen.

The war’s rapid descent into greater peril stoked fears that multiple worst-case scenarios could be realized. The Strait of Hormuz remains effectively closed— a development feared for decades.

With top Persian Gulf oil producers unable to export crude, they have  as storage capacity has already filled up. Iraq’s output has collapsed by 60%.

Bahrain and Iran also said their , threatening water supplies in the Middle East, where some countries get 90% of their water by processing seawater.

The region relies so heavily on desalination that prior intelligence assessments warned damage to this infrastructure could force evacuations from parched cities.

Meanwhile, the U.S. and Israel attacked an oil depot in Tehran, destroying supplies used by both civilians and the military. Smoke covered the city, and acid rain and oily rain fell. Iran’s missiles and drones have also targeted oil and civilian infrastructure around the Gulf.

The Pentagon confirmed the death of a seventh U.S. service member in the war, and that Trump is contemplating a special forces mission where troops would enter Iran to seize near-bomb-grade uranium—material that could be used in a nuclear weapon.

More countries could join the conflict: Gulf states have reportedly warned Tehran that continued attacks on them could trigger direct action against Iran. Turkey may send fighters to northern Cyprus, and to Iran on U.S. military assets in the region.

Iran has remained defiant and announced , the son of Ayatollah Ali Khamenei, will become the next supreme leader following his father’s death last weekend. Days earlier, Trump had rejected him as a possibility.

“Khamenei’s son is unacceptable to me,” . “We want someone who will bring harmony and peace to Iran.”

Iran’s choice for supreme leader is seen as a sign that hardliners in the regime are in control and poised to resist any compromise with the U.S.

When asked in the Oval Office last week about the worst-case scenario in Iran, Trump replied: “I guess the worst case would be we do this and then somebody takes over who’s as bad as the previous person, right? That could happen.”