European shares dip as oil nears $100, Mideast tensions fan inflation fears

European shares slipped on Wednesday, Sept. 9, ahead of U.S. inflation data, with Brent crude approaching the key $100-per-barrel threshold as renewed Middle East tensions fanned inflation worries and curbed risk appetite.

By 0810 GMT, the pan-European STOXX 600 was down 0.4% at 646.84 points. Germany's DAX edged 0.5% lower, London's FTSE lost 0.2%, and France's CAC 40 slipped 0.6%.

The Middle East conflict escalated this week after Iranian-backed Houthi forces in Yemen launched strikes on several Saudi cities, pulling a key U.S. ally deeper into the war. The latest attacks threaten to deepen disruptions to Middle East oil supplies, which were already strained by attacks on regional energy infrastructure and important shipping lanes.

Energy shares gained nearly 1% as Brent crude traded close to $100, a level last seen in late July.

The surge in oil prices has reignited inflation concerns, reinforcing expectations that central banks may need to maintain tighter monetary policy for longer.

Traders widely expect the European Central Bank to raise interest rates on Thursday, according to LSEG-compiled data, just ahead of potentially market-moving U.S. inflation figures due later this week.

Among individual movers, shares of Auto1 Group SE shed 4.6% after Christian Wallentin stepped down as chief financial officer of the German online used-car platform.