Stocks fall on Wall Street as oil prices jump back above $100 a barrel after Iran war escalates

Stocks on Wall Street lost ground again Wednesday as the price of crude oil climbed back above $100 a barrel amid further escalation in the U.S. war with Iran.

The S&P 500 index fell 0.5%. The Dow Jones Industrial Average dropped 0.8%, and the Nasdaq composite gave up 0.6%. The indexes are each on track for a weekly loss.

The losses were broad, with retailers among the companies that pulled the market lower. Amazon fell 1.8%, Starbucks lost 1.9% and Home Depot dropped 1%. Every sector within the benchmark S&P 500 declined except for energy, which rose as oil companies notched gains. Exxon Mobil rose 2.2% and Chevron added 1.9%.

Oil prices drove much of the action on Wall Street. The U.S. destroyed five Iranian tankers on Tuesday in a series of attacks between the two nations . The conflict that began in February has essentially shut down traffic in the Strait of Hormuz, where a fifth of the world's oil supply passed before the war began.

The price of Brent crude, the international standard, rose 3.4% to settle at $101.21 a barrel. It marks the first time the price surpassed $100 a barrel since July .

The Iran war is likely going to keep oil prices elevated at least through the U.S. midterm elections in November, President Donald Trump said Wednesday.

The jump in oil prices over the course of the war has fueled already high inflation. Gasoline prices in the U.S. are up about 32% from a year ago to $4.22 per gallon. Higher fuel prices cut into household budgets directly when it comes to the cost of driving, but they also indirectly raise prices for goods because of higher shipping costs.

The price of diesel, which can have an outsized impact on consumers because it is used in shipping and production, hit an all-time high Friday and has continued to climb since. The average price for a gallon reached $5.94 overnight and is now 9 cents higher than it was Friday.

Inflation was already stubbornly high when the U.S. started its war against Iran because of the ongoing U.S. trade war with much of the world. That trade war is also heating up, especially between the U.S. and its close ally and trade partner Canada.

Wall Street will get more updates this week on inflation, starting with a look at prices at the wholesale level on Thursday with the release of the Producer Price Index for August. It measures prices businesses pay for goods before they reach customers. That report will be followed up Friday with the release of the Consumer Price Index, or CPI, for August, which shows the more direct price impact for households.