U.S. equity futures fell on Thursday, as oil prices surged amid escalating conflict in the Middle East, while investors weighed quarterly results from two of the largest companies in the world.

Futures
 tied to the Dow Jones Industrial Average lost 523 points, or 1%. S&P 500 futures
 dropped 1%, while Nasdaq 100 futures
 lost 1.3%.

Alphabet
 shares slid more than 5% to reach their low of the session after the Google parent lifted its forecast for 2026 capital expenditures to as high as $205 billion, pointing to strong artificial intelligence demand. The increase comes as investors have grown more cautious in recent months about hyperscalers’ spending around the AI effort.

Tesla
 tumbled more than 7%, also hitting its session low, after the electric vehicle maker posted a big earnings miss for the second quarter. The company’s operating expenses also rose faster than revenue during the period.

Oil prices put more pressure on stocks, as they soared after Yemen’s Tehran-backed Houthi militant group claimed attacks on two Saudi Arabian tankers in the Red Sea, fueling concerns about an expansion of the conflict in the Middle East. Prices also moved higher after U.S. President Donald Trump threatened to bomb Iranian infrastructure.

Brent crude futures for July delivery gained 5% to trade above $99 per barrel, while U.S. West Texas Intermediate crude futures advanced 4% to above $90 per barrel. Both Brent and WTI were trading at their highest levels since before the U.S. and Iran reached an agreement to bring their war to an end last month.