Oil Prices Set to Keep Rising Even After Iran -2-

0813 GMT - Gold slides 2% as fresh U.S.-Iran strikes raise fears that a prolonged conflict and higher oil prices could fuel inflation and prompt interest-rate hikes by the Federal Reserve. The U.S. launched military strikes Tuesday against Iran in response to the downing of a U.S. Apache helicopter near the Strait of Hormuz, while Iran's Islamic Revolutionary Guard Corps launched a drone attack on the U.S. Fifth Fleet in Bahrain. The latest escalation has increased uncertainty over prospects for a peace agreement and gradual reopening of the Strait, a critical artery for global energy shipments. "The precious metal is now roughly 20% below its pre-conflict level, with additional selling pressure emerging after prices fell below key technical support levels closely watched by investors," analysts at MUFG say. In early trading, New York gold futures are down 2.3% to $4,185.70 a troy ounce. (giulia.petroni@wsj.com)

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