New York (CNN) — Global stocks remained volatile for a second day Tuesday, moving sharply lower as concern mounted among investors that the widening conflict in the Middle East could escalate further.

The Dow tumbled 1,140 points, or 2.33%, shortly after the market open. The S&P 500 and tech-heavy Nasdaq each sank 2.1%. Wall Street’s fear gauge, the VIX, surged 22% and hit its highest level in three months.

Stocks in Europe and Asia were lower for a second day. Europe’s benchmark Stoxx 600 sank 3.2%. Japan’s Nikkei 225 fell 3.06%. South Korea’s Kospi index tumbled 7.24%, posting its worst day since April. Markets in South Korea were closed Monday in observance of a holiday.

“It is not possible at this time to know the full scope and duration of military operations that may be necessary,” President Donald Trump wrote Monday in a letter to Sen. Chuck Grassley.

Military action in the region intensified for a fourth-straight day, with Israel saying it is conducting “simultaneous strikes in Tehran and Beirut,” targeting Iranian military sites and the Iran-backed group Hezbollah. US embassies in Saudi Arabia and Kuwait have been hit in strikes amid Iranian bombardment, sources told CNN. And non-emergency US government personnel in Jordan, Bahrain, Iraq, Qatar, Kuwait and the United Arab Emirates have been ordered to depart due to security concerns.

Investors are bracing for additional pressure on oil prices after Iran said Monday it would attack any ship trying to pass through the Strait of Hormuz, the narrow channel off Iran’s coast through which nearly 20% of global oil consumption flows. Vessel operators and maritime insurers are unwilling to risk sailing through it while fighting rages.

US crude oil prices rose 8% Tuesday to $76.91 per barrel after rising 6.3% on Monday, and gas shot 11 cents higher to $3.11 a gallon. Brent crude, the international oil benchmark, gained 7.6%, to $83.65 per barrel, its highest level since July 2024.

Safe haven assets showed mixed moves Tuesday: The 10-year Treasury yield climbed as investors sold bonds and weighed the inflationary impact of higher oil prices.

The US dollar index gained 0.98% on expectations that inflation could further delay Federal Reserve rate cuts, supporting the greenback. The dollar index is up nearly 1.8% so far this week.

“That the current war may be ‘inflationary’ is what’s panicking traders today,” Thierry Wizman, global FX and rates strategist at Macquarie Group, said in a note.

“The view of a short war been upended today because of suggestions from the US administration that the war may be prosecuted for longer than a few weeks,” Wizman said.

Gold was down 5%, continuing a recent bout of volatility and reversing course after climbing 1.2% on Monday to reach its highest level in a month.

Natural gas futures in Europe surged 24% Tuesday after soaring 38% Monday. US natural gas futures were up 6.3% after climbing 3.5% Monday.

For the United States, gains in diesel prices outstripped gains in oil and natural gas: Diesel futures surged 13% Tuesday after climbing nearly 12% Monday.

This story is developing and will be updated.

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