Brent oil prices increased by 4.5% to 76.07 USD/barrel, even exceeding the 82.00 USD mark at one point, while US crude oil prices increased by 3.9% to 69.59 USD/barrel. Gold prices increased by 1.0% to 5.327 USD/ounce.
US and Israeli military attacks on Iran show no signs of easing, while Iran responds with missile launches across the region, risking dragging neighboring countries into conflict.
President Donald Trump suggested to the Daily Mail that the conflict could last for another 4 weeks, and posted on social media that the attacks will continue until US targets are achieved.
All attention is focused on the Strait of Hormuz, which transports about 1/5 of the world's oil and 20% of the world's liquefied natural gas. Although this key waterway route has not been blocked, maritime tracking websites have seen oil tankers congested on both sides of the strait, possibly due to fears of being attacked or unable to buy insurance for the trip.
The most direct and clear development affecting the oil market is the disruption of traffic through the Hormuz Strait, preventing 15 million barrels of crude oil per day from reaching the market. Unless signs of rapidly de-escalation appear, we predict oil prices will rise sharply," said Jorge Leon, head of geopolitical analysis at Rystad Energy.
A prolonged oil price increase will risk re-igniting global inflationary pressure, while also burdening businesses and consumers, which may reduce demand.
On March 1, OPEC+ agreed to increase oil production to a modest level of 206,000 barrels/day in April, but most of that oil still had to be transported out of the Middle East by oil tankers.
In our opinion, the most similar case in history is the oil embargo on the Middle East in the 1970s, which caused oil prices to increase by 300% to about 12 USD/barrel in 1974. That figure is only equivalent to 90 USD/barrel in 2026. Overcoming this figure in the current market's concern about a significant supply shortage seems entirely feasible," said Alan Gelder, Senior Vice President of Refining, Chemicals and Oil Markets at Wood Mackenzie.
This development will affect Japan because it imports all of its oil. The Nikkei index fell 1.4%. Aviation companies are expected to be the most heavily affected sectors.
The broadest MSCI index of Asia-Pacific stocks outside of Japan decreased by 1.2%.
In the Middle East, the UAE and Kuwait temporarily closed the stock markets on the grounds of "special situations".
For Europe, EUROSTOXX 50 futures fell 1.4% and DAX futures fell 1.3%. On Wall Street, S&P 500 and Nasdaq futures both fell 0.6%.
The oil shock spread throughout the currency market, in which the USD was the main beneficiary. The US is a net energy exporter and Treasury bonds are still considered a safe haven in times of tension, pushing the euro down 0.2% to 1.1788 USD.
