Market wrap (09.03.2026)

Oil prices are surging sharply following attacks on Iranian oil infrastructure and retaliatory actions that have escalated the conflict.

WTI crude is rising more than 15% to 104.50 USD per barrel, and at the session open it gained as much as over 27% to above 117 USD per barrel. Brent crude is rising on a similar scale to 108.00 USD per barrel and nearly 120 USD per barrel at the open. This marks one of the largest single-day increases since the pandemic.

The price jump reflects fears of a major supply shock after the effective closure of the Strait of Hormuz. Normally, around 20 million barrels of oil per day pass through this route.

Transport through the Strait of Hormuz has practically stopped, leaving millions of barrels of oil without the ability to be shipped. Iraq, Kuwait, and other producers have begun limiting production due to the lack of tanker access. Even if the conflict eases, restoring full supply flows could take time.

The US dollar is strengthening by an average of 0.41% against other G10 currencies. Yields on US 10-year bonds have risen to around 4.20% amid growing inflation concerns. Gold is trading largely unchanged around 5,127 USD per ounce.

G7 countries are considering a coordinated release of strategic oil reserves in cooperation with the IEA. A level of 300–400 million barrels is being discussed, which would represent a much larger intervention than previous actions. Such measures could reduce prices by around 10–20 USD per barrel, although the effect would likely be mostly short-term.

Although releasing reserves increases oil supply, it does not replace refining capacity. This means fuel prices for consumers could remain high even if crude prices decline.

Japan is one of the biggest economic losers from rising oil prices due to its strong dependence on energy imports. The country may be forced to spend up to 70% more dollars to secure the same amount of crude.

Donald Trump stated that oil prices will fall quickly once the nuclear threat from Iran is eliminated. His comments suggest that the main objective of the war may be the dismantling of Iran’s nuclear program.

Trump reportedly expressed frustration after Israel struck 30 Iranian fuel storage facilities. US officials feared the attacks would deepen global oil shortages and further increase fuel prices.

This marks the first noticeable point of tension between Washington and Israel during the conflict. Rising fuel prices could also increase political pressure in the United States.

China’s CPI inflation rose by 1.3% y/y in February, clearly above expectations. At the same time, producer prices remain in deflation.