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Dollar slips as Middle East tensions lift oil and pressure risk sentiment

WTI and December 2026 WTI futures gained as renewed Middle East and conflict-linked oil supply risks increased risk premiums, with volatility hitting fresh highs.

Reported · Written up by our desk · Major Pairs

A mixed week for US markets put the US dollar and oil in the spotlight, with the dollar weakening after softer US CPI and PPI data, according to Action Forex. The report said safe haven flows tied to renewed Middle East tensions helped limit the extent of dollar losses.

Oil prices rose, with both spot WTI and December 2026 WTI futures posting solid gains as the risk premium jumped and volatility reached fresh highs. Action Forex attributed part of the rise to a barrage of Ukrainian attacks on Russian oil installations, including refineries, as the conflict escalated.

Action Forex also pointed to a shift in equity drivers ahead of next week, noting that early optimistic earnings from US banks and technology firms were followed by profit-taking and a pullback. It said the Nasdaq 100 was hit hardest, while European equities struggled to recover.

Looking ahead, Action Forex said investors are likely to focus on earnings, an ECB meeting, and the UK data and political calendar, with key company reports including Alphabet and Tesla on Wednesday and Intel on Thursday. The outlet framed technology results and expectations for AI investment profitability as key factors for whether risk assets can rebound, or if bearish momentum persists.

Latest closeWTI crude $79.00 ▼0.8%|Nasdaq Comp. 25,881.95 ▼1.5%

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