U.S. stock futures fell late Sunday as oil prices rose, but did not rise as investors kept cool after a weekend of fresh fighting in the Persian Gulf.
Futures tied to the Dow Jones Industrial Average fell 100 points, or 0.19%. S&P 500 futures lost 0.27% and Nasdaq futures lost 0.48%.
U.S. oil futures rose 3.2% to $73.70 a barrel, while Brent crude also rose 3.2% to $78.45. Gold fell 0.7% to $4,085 an ounce.
Bob McNally, founder and president of Rapidan Energy, told CNN that crude oil markets have “been dismissing this geopolitical risk for years” and described Sunday’s price increase as “pretty benign.”
Traders are confident that the worst of the Hormuz conflict is over and are seeing the beginnings of a recovery in shipping crossings and oil production around the Gulf, he said, adding that the stock market has not paid attention to Iran since April.
“There’s a lot of complacency and confidence in the market right now about oil,” said McNally, a former White House energy adviser.
On Sunday evening, US Central Command announced another series of strikes against Iran, which aims to “impair their ability to attack civilian sailors and merchant vessels sailing freely through the Strait of Hormuz.”
It was the fifth round of attacks in the past week and the third in the last 24 hours, suggesting that the pace of operations is accelerating.
The latest wave came after the Islamic Revolutionary Guard Corps attacked a merchant ship, prompting U.S. forces to intercept an Iranian missile and drone.
Earlier on Sunday, the US carried out “some attacks” on Iranian missile and air defense systems as well as small boats around the strait.
U.S. forces had previously attacked 300 targets in three previous rounds, with 140 targets bombed on Saturday alone, including missile and drone sites, naval capabilities, ammunition storage facilities, communications networks and coastal surveillance sites, Central Command said.
Iran, for its part, has paired its attacks on merchant ships with volleys against its Arab Gulf neighbors, including Bahrain, Kuwait, Qatar, Jordan and Oman.
Iran has argued that the memorandum of understanding signed with the US last month gives it the authority to regulate shipping traffic and has attacked ships that do not use a regime-backed corridor along Iran’s coast.
However, the US has called for freedom of navigation to be fully restored in Hormuz and has established an alternative corridor encircling Oman’s coast. Since early May, U.S. forces have helped more than 800 merchant ships and 400 million barrels of crude oil transit through the strait.
The standoff has increased increasingly violent conflicts as Iran seeks to preserve its most important source of influence, namely the ability to effectively interdict Hormuz traffic.
For Sal Mercogliano, a professor at Campbell University who specializes in military and naval history, the recent fighting was an ominous sign, calling the ceasefire a “facade.”
“And it’s been a facade for a while,” he said said in a YouTube post on Sunday. “And one of the things I fear is that we are in this undeclared naval war. And an undeclared naval war can escalate.”