(Updates to U.S. market close)

* Oil prices settle at highest since 2022

* Global stocks slump 1.5%

* Bond yields climb

* Euro under pressure versus dollar

By Lawrence Delevingne and Niket Nishant

BOSTON/LONDON, March 12 (Reuters) - Global shares fell

on Thursday as attacks on oil tankers in the Gulf and warnings

from Iran shattered prospects of quick de-escalation in the

Middle East conflict, pushing oil prices to around $100 a barrel

and stoking inflation concerns.

Wall Street's stock indexes slumped, dragged down by rising

oil prices and concerns about the private credit market. The Dow

Jones Industrial Average and the S&P 500 dropped

about 1.5%, and the Nasdaq Composite lost 1.8%. The

STOXX 600 pan-European equity benchmark slipped 0.6%,

while the MSCI All-World index fell 1.5%.

Brent crude futures settled at $100.46 a barrel, up

$8.48, or 9.2%, after touching a session high of $101.60. U.S.

West Texas Intermediate crude settled at $95.70, up

$8.48, or 9.7%. Both contracts settled at their highest since

August 2022, as doubts persisted over whether reserve releases

would be enough to cushion the hit from the Middle East supply

shock.

Monica Guerra, head of U.S. policy at Morgan Stanley Wealth

Management, said in a report on Thursday that geopolitically

driven equity volatility is historically short-lived. But if

higher oil prices persist, "the Fed's reaction function could be

complicated, supporting a higher fed funds rate for longer."

IRAN WARNS OF MORE ATTACKS

Iran will avenge the blood of its martyrs, keep the Strait

of Hormuz closed and attack U.S. bases, new Supreme Leader

Ayatollah Mojtaba Khamenei said on Thursday in a statement read

on state television, his first remarks since succeeding his

slain father.

Earlier, two fuel tankers in Iraqi waters were struck by

explosive-laden Iranian boats, Iraqi security officials said,

while an Iraqi official told state media its oil ports "have

completely stopped operations."

Iran had earlier stepped up attacks on merchant ships in the

Strait of Hormuz, increasing the number of ships struck in the

region since fighting began to at least 16. Tehran has warned

the world to get ready for oil at $200 a barrel, although U.S.

Energy Secretary Chris Wright said on Thursday global oil prices

are unlikely to hit that price.

"The longer this goes on, the more stress there is inserted

in global markets," said Ayako Yoshioka, portfolio consulting

director at money manager Wealth Enhancement.

INFLATION RISKS

Data on Wednesday showed the U.S. consumer price index rose

0.3% in February, in line with forecasts and above January's

0.2% increase. The report was not regarded as particularly

relevant however given the Iran war has started to fuel

inflation.

In bond markets, the risk of rising inflation outweighed

safe-haven considerations to push yields higher globally. Yields

on 10-year Treasury notes rose 5.5 basis points to

4.261%, while two-year Treasury yields hit a six-month high.

Also worrying markets was the $2 trillion private credit

market after Swiss private equity firm Partners Group warned

default rates could double in the next few years.

Morgan Stanley ( MS ) fell 4% after limiting redemptions at

one of its private credit funds following similar actions by

Blackstone and BlackRock ( BLK ) earlier this month.

Blackstone and BlackRock ( BLK ) were down 4.7% and 2.9% respectively.

The U.S. Federal Reserve will cut interest rates for the

first time this year in June, according to economists polled by

Reuters. Nearly 40% expect just the one rate reduction or none

this year, almost double the share predicting three or more.

Nervous investors sought the liquidity of dollars while

shunning currencies from countries that are net energy

importers, including Japan and much of Europe.

The euro slipped 0.45% to $1.1515. The dollar was

0.28% stronger at 159.36 yen. The dollar has

risen by more than 1.5% against a basket of major currencies and

is close to its highest level since November, in part due to its

safe-haven appeal, but also because the U.S. is a net energy

exporter.

Gold prices fell around 1.7% to $5,088 an ounce.