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* Futures off: Dow 0.52%, S&P 500 0.59%, Nasdaq 0.82%

March 20 (Reuters) - U.S. stock index futures slipped in

choppy trading on Friday as the Iran war approached its fourth

week, roiling energy markets and prompting investors to

aggressively reprice bets on interest rate cuts by the U.S.

Federal Reserve.

A report said the Trump administration is considering plans

to occupy or blockade Iran's Kharg Island to pressure Iran to

reopen the Strait of Hormuz.

Crude prices rose, reversing all the losses recorded since

major European nations, Japan and the United States hinted at

efforts to boost energy supply. Brent crude prices were last up

1.7% at over $110 a barrel.

The CBOE volatility index, sometimes referred to as

Wall Street's fear gauge, edged up 1.72 points to 25.78. Futures

tracking the rate-sensitive Russell 2000 index slipped

1%.

Investors took some comfort in FedEx's ( FDX ) upbeat

results and forecast despite geopolitical tensions and surging

fuel costs, sending its shares up 10% in premarket trading.

Rival United Parcel Service ( UPS ) added 1%.

FedEx ( FDX ), often seen as a barometer of business activity, said

that global demand was holding steady at the start of March

despite the war in Iran, while fuel surcharges were sheltering

profits from surging fuel costs.

This week was packed with decisions by major global central

banks that along with the Federal Reserve acknowledged how the

conflict had complicated policymaking. While U.S. policymakers

are still penciling in at least one quarter-point interest rate

cut this year, investors are less convinced.

Traders have pushed their bets for a rate cut to sometime in

2027, from December 2026 earlier this month, according to

LSEG-compiled data.

At 06:06 a.m. ET, Dow E-minis were down 242 points,

or 0.52%, S&P 500 E-minis were down 39 points, or 0.59%.

Nasdaq 100 E-minis were down 200.5 points, or 0.82%.

Wall Street's benchmark S&P 500 and the blue-chip Dow

were on track to finish their fourth-straight week in the

red, although a modest bounce-back in AI stocks such as Advanced

Micro Devices ( AMD ) and Micron have cushioned the fall

on the Nasdaq.

All the three indexes also slipped below their 200-day

moving average, a technical indicator reflecting long-term

momentum, while the small-cap-focused Russell 2000 index

briefly logged a 10% drop from all-time highs earlier this week.

Super Micro Computer ( SMCI ) tumbled 23% after three people

associated with the artificial intelligence server maker were

charged with helping smuggle at least $2.5 billion of U.S. AI

technology to China in violation of export laws.

Gains have been strong in energy stocks. The S&P 500 sector

index is set for its thirteenth-straight week of gains

as geopolitical events in Venezuela and the Middle East

dominated much of the first quarter.

Energy stocks such as Halliburton ( HAL ) and Cheniere

Energy added 1% and 3%, respectively.

Tegna ( TGNA ) gained 9.4% after the Federal Communications

Commission said it approved the $3.54 billion sale of the local

television station owner to Nexstar..

(Reporting by Johann M Cherian in Bengaluru; Editing by

Saumyadeb Chakrabarty)