"Higher oil and gas prices are certain as the closure of the Strait of Hormuz threatens to disrupt 15% of global oil supply and 20% of global liquid natural gas supply, with oil prices potentially exceeding $100 per barrel if tanker flows are not quickly restored."
"We cannot confidently map the military or political path ahead, but recognize that this event generates greater macroeconomic risk than recent military conflicts - the US intervention in Venezuela or the Israel-Iran conflict. Through its potential to disrupt..."
"In the months after the first and second Gulf Wars the S&P 500 rose 16% and 14%, respectively."
A geopolitical conflict between Iran, the U.S., and Israel triggered a worldwide market selloff, with S&P 500 futures down 1.22%, European indices declining 0.63-1.76%, and Asian markets falling 1-1.35%. Despite the risk-off sentiment, certain assets benefited from the turmoil. Oil prices jumped 13%, reaching potential $100+ per barrel levels due to threats to the Strait of Hormuz disrupting 15% of global oil supply. Gold hit all-time highs as a safe-haven asset, while the dollar strengthened nearly 1%. Defense stocks rallied significantly, with BAE Systems up over 6% and Rheinmetall AG up 2%. Analysts noted historical precedent showing S&P 500 gains of 14-16% following previous Gulf Wars, suggesting potential long-term market recovery despite immediate volatility.
Read at Fortune
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