When no one knows what the next hour will bring, a certain kind of silence descends upon a trading floor. The slow way traders check their phones in between lunch bites and the way headlines are read twice are examples of this. Most days in 2026 are like that. In addition to being erratic, markets are jittery in the same way that people become jittery after a loud noise, anticipating the next one.
Additionally, there is nearly always a single source of the noise. The Strait of Hormuz no longer functions as a piece of geography but rather as a light switch since the United States and Israel attacked Iran in late February, killing Supreme Leader Ali Khamenei. The world responds when Iran flips it. Normally, between twenty and twenty-five percent of seaborne oil passes through that twenty-one-mile water gap, but for weeks now, the majority of it hasn’t. Tankers are seated. Mariners hold off. Additionally, every few days, a fresh story from Tehran causes the price of Brent crude to fluctuate by ten dollars.
Observing it has been peculiar. In contrast to the panic that has been priced in on the worst days, the S&P 500 ended the first quarter down 7.3%, which sounds almost courteous. In March, Brent reached $120 per barrel. Then, on rumors of talks, it fell back toward $85. When an Iranian container ship was apprehended in the Gulf of Oman, it leaped once more. On a Sunday night in early March, the Dow was headed for a 900-point decline, but by the following afternoon, it had closed up 250 points. This kind of swing would have been the highlight of the month in a more tranquil year. It’s Tuesday now.
| Topic | Global Stock Markets & the 2026 Iran War |
| Epicenter of disruption | Strait of Hormuz, between Iran and Oman |
| Share of seaborne oil trade that normally passes through | Roughly 25% |
| Daily oil volume (pre-crisis) | ~20 million barrels per day |
| War start date | February 28, 2026 |
| Brent crude peak during crisis | Close to $120 per barrel |
| Brent crude, April 21, 2026 | Around $95.75 |
| S&P 500, Q1 2026 | Down 7.3% |
| Gold in February 2026 | Up 11.4% |
| Most exposed markets | Asia — China, India, Japan, South Korea |
| Tracking body for global trade impact | UNCTAD |
| Current status | Shipping still largely blocked; ceasefire negotiations ongoing in Islamabad |
Investors appear to have conflicting opinions, which is typically an indication that they are still undecided. They’re purchasing gold as though the war won’t end, but they’re acting as though it will to prevent a worldwide recession. In February, gold increased by over 11%, and it has remained high ever since. A market that truly believes in the rally would not act like that. It is the way a market protects itself from its own optimism.
Geographically rather than financially, Asia has suffered the most. The bulk of Hormuz oil is extracted by China, India, Japan, and South Korea; there are no simple detours. Kospi in Korea has swung more forcefully than practically anywhere else. European stock markets have sold off on recession fears due to the possibility that the ECB will delay rate cuts. Although the United States is currently a net exporter of oil and LNG, it is still somewhat protected. However, earlier this month, gas prices surpassed $4 per gallon, and there is a quiet concern in Washington that if they rise above $5, there will be an irreversible shift in the political climate.
As this develops, it’s difficult to ignore how much the direction of the market is dependent on factors that cannot be modeled by a spreadsheet. Trump’s statement that the war was “very complete, pretty much,” during a phone interview with CBS in March, set off a late-afternoon rally that reversed a steep morning decline. Muhammad Bagher Qalibaf, the speaker of the Iranian parliament, immediately referred to the reports as “fakenews.” That was just one day. It’s one of dozens. Press conferences, prayer, and policy have all evolved into tools for influencing the market.
On paper, at least, energy companies are winning the war. The majors have risen due to rising oil prices, and some analysts believe the crisis has permanently reset the floor price of crude into the high 1980s or 1990s. In an earnings report, that sounds good. If you run a factory in Bavaria or a textile mill in Punjab, where input costs are already very high, it doesn’t sound as good. The majority of the world can relate to UNCTAD’s warning that developing economies are being most severely impacted by rising energy, fertilizer, and freight costs.
Everybody seems to be waiting for the same phone call this spring, and nobody knows who is expected to make it. In mid-April, there was a brief ceasefire, Hormuz reopened, and Brent dropped more than ten percent in a single session. However, within seventy-two hours, Iran reinstated controls, tankers retreated, and the rally came to an end. Whether the delegation traveling to Islamabad this week can accomplish anything is still up in the air. The pattern is evident. Markets wait for Iran, rise on hope, and fall on reality.
