U.S. Strikes on Iran Fuel Market Jitters, Oil Prices Expected to Spike

Global markets are bracing for volatility after the U.S. launched airstrikes on Iran’s nuclear facilities, a move President Donald Trump called “a spectacular military success.” Investors expect a sharp rise in oil prices and a rush to safe-haven assets when markets reopen, while equities could see a short-term selloff.

The attack deepens U.S. involvement in the Middle East conflict, injecting fresh uncertainty into global markets. Analysts warn that a dramatic rise in oil prices could stoke inflation, hurt consumer spending, and lower the odds of interest rate cuts. Brent crude, already up 18% since June 10, is projected to rise even further, especially if the Strait of Hormuz is threatened or Iranian oil exports are disrupted. Oxford Economics previously projected oil could hit $130 per barrel in a worst-case scenario, pushing U.S. inflation to 6% by year-end.

Financial experts like Mark Spindel of Potomac River Capital and Jack Ablin of Cresset Capital say market sentiment will depend heavily on Iran’s response. While initial panic may drive the dollar higher and stocks lower, past conflicts suggest market corrections could be brief. Historical data shows the S&P 500 often rebounds within months after geopolitical shocks.

Jamie Cox of Harris Financial Group noted that the scale of the strikes may push Iran toward a peace deal, potentially easing long-term market fears. However, economists caution that Trump’s tariffs, combined with a spike in energy prices, could further strain the global economy.

Though uncertainty looms, market participants will closely watch Iran’s next move, as it will likely determine the direction of oil prices, inflation, and overall investor sentiment. Investors are preparing for a tense market open as geopolitical risks take center stage.