Stockshake: what will happen to global markets amid the crisis in the Middle East
The second attack by the United States and Israel on Iran in the last 8 months has taken most of the world community by surprise. Traders on the stock exchanges, who reacted rather nervously to the events, were no exception. Stock exchanges around the world are closed for the weekend, so we will see some effect on the stock, bond and commodity markets only on Sunday night, when Asian markets open. But trading on crypto exchanges continues 24/7, and the results are already noticeable. Izvestia analyzed the situation on the eve of the big shock.
Oil
The key market for the current conflict. The previous military operation against Iran had a rather sluggish effect on the market. This probably influenced the decision of the American administration to repeat the attack in 2026. The United States is now, in principle, much less dependent on Middle Eastern oil, and geopolitics does not strongly influence quotes. But this time the situation may be different.
First, Iran has already announced the blocking of the Strait of Hormuz, an event that was classified as "unthinkable" or at least "unlikely" during previous escalations, through which 20% of the world's oil production passes. By the evening of February 28, the strait was almost closed. In a notice issued by the U.S. Navy's Central Command early Saturday morning, vessels were advised to refrain from sailing in the area if possible.
Secondly, Iran may well strike at the oil and gas facilities of the Arab monarchies in the Persian Gulf, since they are also involved in the operation in one way or another, providing their territory as bases for American strikes. This is not happening yet, but given the scale of the escalation and the maximum tasks set by the United States and Israel (and this is regime change in Tehran), such actions do not seem completely improbable.
By the way, Iran itself has seriously increased production and supplies in recent months, bypassing sanctions. Including condensate, the volume of oil production in January reaches 5 million barrels. The withdrawal of even a third of this volume from the market will be significant.
As of Friday evening, when the likelihood of attacks became very high, Brent crude oil prices had already exceeded $73 per barrel, the highest since last summer. Analysts allow a rise to the range of $80-100, provided that the impacts are "limited." But so far, the development of events looks anything but "limited."
In parallel, by the way, gas prices may skyrocket. Although it has long since gotten rid of oil prices, the cessation of LNG supplies from the Persian Gulf, especially in early spring, may be very significant, at least for a short period of time.
Gold and Silver
Precious metals remain at their peak, and the Iranian crisis will obviously only strengthen their positions. On the evening of February 27, a troy ounce of gold came close to $5,300. Analysts predict a rise to $5,450, and this is probably not the limit. Silver in India soared at auction on Saturday, and on international markets, even before the first strikes began, it rose by 5% during the session, reaching $92.5 per ounce.
Precious metals remain the main safe haven asset in the context of a major conflict in the Middle East. The general economic situation in the world only spurs their growth.
Cryptocurrencies
The bidding continues here. Cryptocurrencies collapsed in the first hours of the operation — bitcoin fell by 4% to $ 63 thousand, however, then regained most of the losses. Most analysts predicted this development. Bitcoin is currently not a "safe haven", but a risky asset, and it will be disposed of first. Now it is obvious that he has not yet succeeded in becoming "digital gold".
On the other hand, bitcoin has already been extremely actively sold in recent months — it will be quite difficult for it to fall even lower.
Winners and losers
In general, it is almost certain that on Monday we will see an increase in the following assets:
The dollar and the Swiss franc are currently the best "safe haven" option of all currencies. However, if the latter strengthens too much, the Swiss Central Bank may intervene with interventions. If the markets as a whole fall, defense contractors will soar in value. An operation of this scale will be a signal that the military tension in the world is growing. Freight rates could skyrocket significantly, which would be great news for shipping company owners.
The stock markets of Europe and especially Asia may be in the greatest disadvantage. China and India rely on oil from the Persian Gulf. As the EU abandons Russian hydrocarbons, it also imports more and more fuel and raw materials for the chemical industry from this region. The escalation of the conflict threatens to have catastrophic consequences for European industry, which has not yet recovered from sanctions against Russia.
Переведено сервисом «Яндекс Переводчик»
