Wall Street heading for losses as oil prices spike on US-Iran escalation

The U.S. launched an 11th night of airstrikes on the Islamic Republic, hitting targets across Iran and raising doubts about a diplomatic solution to end the conflict as it threatens to again spin out of control.

Shipping remains largely stalled through the Strait of Hormuz, the narrow mouth of the Persian Gulf through which a fifth of all oil and natural gas traded passed in peacetime. Iran’s attacks on shipping in that waterway sparked the recent series of U.S. responses, and the Iranian-backed Houthi rebels of Yemen are now threatening Saudi oil tankers in the Red Sea as well.

That's pushed prices for Brent crude, the international standard, up $3.81 to $94.82 per barrel.

Benchmark U.S. crude added $3.31 to $87.65 a barrel.

Rising oil prices are again pushing inflation higher, just as price increases were slowing more than economists expected. That could push the Federal Reserve and other central banks to raise interest rates, which would slow economies and undercut prices for stocks and other investments.

The Fed meets to decide on interest rates next week.

The auto club AAA said Wednesday that the average price for a gallon of regular gas in the U.S. jumped again overnight to $4.06. That's still below highs of around $4.56 per gallon in May, but well above the sub-$3-a-gallon in the months leading up to U.S. and Israel's attacks on Israel in late February.

Higher fuel prices not only make consumers more cautious about spending, but also raise costs for shipping and almost all businesses.

In equities trading, Super Micro Computer soared 17.5% after the server and storage maker issued an earnings preview revealing that gross margins will come in well ahead of guidance. The California company also said that its full fourth-quarter earnings release on Aug. 11 will show a record backlog of orders.

AT&T rose 3.6% before the opening bell after it topped Wall Street profit expectations.

Coming after the closing bell are earnings reports from Tesla and Google parent company Alphabet.

In Europe, France's CAC 40 edged up 0.4% at midday, while the German DAX rose 0.4%. Britain's FTSE 100 gained 1.3%.

Japan's benchmark Nikkei 225 fell 0.2% to finish at 66,115.60, after the government reported that both imports and exports rose last month from a year earlier, as the weakening yen raised the value of both when converted from dollars to yen.

Australia's S&P/ASX 200 added 0.3% to 8,823.00. South Korea's Kospi rose 0.7% to 6,797.70. The Hang Seng dipped nearly 1.0% to 24,892.66, while the Shanghai Composite was little changed, adding less than 0.1% to 3,867.03.