Yerevan, 04 March 2026

The start of a joint US-Israel military operation against Iran, aimed at Supreme Leader Ayatollah Ali Khamenei, regime infrastructure, and military targets, has redrawn the region’s risk map and has had an immediate spillover into the global economy and financial markets. This new phase of heightened tensions has increased risk around the Persian Gulf states (UAE, Kuwait, Bahrain, Saudi Arabia), amplifying geopolitical uncertainty and market sensitivity.

Oil: the primary transmission channel of escalation

At the core of the escalation’s macroeconomic impact is the oil market. Crude oil prices have risen and reacted to regional developments, mirroring the moves observed during the strikes in June 2025.

 A prolonged oil shock acts as a stagflationary impulse - driving higher inflation expectations, tightening financial conditions, and slowing global growth. Net oil-importing economies in Asia and Europe are among the most exposed, as higher energy prices raise both external-balance vulnerabilities and inflation risks. 

The impact of escalation is magnified by the prospect of supply disruptions. The Strait of Hormuz, which handles 20% of global oil shipments, has been halted due to aerial strikes, increasing the cost of supply across markets. At the same time, Iran’s oil sales - primarily flows to China - are likely to be shut down. In this environment, OPEC+’s planned output increases and regional pipeline supplies are insufficient to offset the lost supply, raising the probability of sharper price swings.

From a cross-asset perspective, gold is confirmed as a structural diversifier, and more generally, commodities and commodity currencies are favoured.

Against this backdrop, U.S. assets should remain relatively attractive. Emerging markets will see both winners and losers: oil importers are the most vulnerable, while commodity exporters could benefit. 

Military escalation in the Middle East is shaping a new market regime, with risk transmitted primarily through the energy channel - affecting inflation dynamics, interest-rate expectations, and global growth. The key variable remains the duration of oil-supply risk: the longer the likelihood of disruption persists, the greater the volatility and macroeconomic strain.

Experts at Amundi Investment Institute, in the “Implications of US-Israel strikes on Iran” research paper have outlined the war’s impacts on the macroeconomic and investment environment, as well as the outlook for investment markets under these conditions and the new opportunities that may emerge.