The prolonged US–Iran war is turning the energy shock into broader pressure across global markets

🌍 The US–Iran war, which has dragged on since late February, is putting clearer pressure on global markets and is no longer just a single geopolitical risk. The most sensitive point remains the Strait of Hormuz, where a large share of oil flows to Asia, making the region especially vulnerable.
💱 The pressure is most visible in Asian currencies, with the Indonesian rupiah hitting a record low, while the rupee, peso, won, baht and ringgit also remain under heavy pressure. Central banks have had to intervene more frequently, but their room to sell USD is becoming less comfortable if they want to preserve foreign exchange reserves.
🛢️ The energy shock is also spreading into consumer costs and business operations. US gasoline prices have risen more than 40% from late 2025, diesel is up more than 50%, and jet fuel has jumped nearly 84%, putting direct pressure on transport, airlines and logistics costs.
📉 This impact has already been reflected in airline stocks, especially in Europe, where the sector is down about 14% year-to-date even as the broader market remains higher. Spirit Airlines’ shutdown shows that high fuel costs are not just a price fluctuation, but a real operating risk.
🏦 Inflation pressure is also pushing US Treasury yields higher, with the 10-year yield around 4.40% and moving close to the sensitive 4.5% area. If yields keep rising while energy prices remain elevated, equities, credit and capital flows into emerging markets could face further pressure.
⚠️ In the short term, market focus remains on oil prices, Asian FX and intervention signals from central banks. Without signs of easing in the Middle East, volatility may persist across energy, airlines, transport and yield-sensitive assets.
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