Since Saturday (February 28), the United States and Israel have launched military strikes against the Iranian regime, bringing uncertainty to the global economy, oil prices, and labor markets, while also having a significant impact on countering the Chinese Communist Party.
Following the joint strikes against Iran over the weekend, the stock prices of defense companies in the United States surged. Lockheed Martin saw a 6% increase in its stock price, Northrop Grumman rose by 5%, and drone manufacturer AeroVironment’s stock price soared by over 10%.
In the oil sector, concerns about potential disruptions to global crude oil production and transportation due to the conflict led to significant increases in the stock prices of many oil companies. ExxonMobil and Chevron saw their stock prices rise by 4% and 3% respectively, while ConocoPhillips’ stock price also increased by over 5%.
During early Asian trading on Monday (March 2), Brent crude oil prices surged by 13%, surpassing $82 per barrel, reaching the highest level since January 2025. The price of West Texas Intermediate crude oil also approached $72 per barrel. Stocks of oil tanker companies also saw significant increases, with Frontline rising by over 5%, DHT Holdings up by 7%, and International Seaways increasing by 6%.
With a large number of investors flocked to safe-haven assets like gold and the US dollar, gold futures prices rose by 3%.
Investors are rushing towards safe-haven assets like the US dollar and gold, causing a surge in risk aversion that led to a sharp drop in the stock market, particularly in the technology and banking sectors. Broadcom led the decline in semiconductor stocks, while Amazon and Alphabet saw their stock prices fall. Shares of Morgan Stanley and Goldman Sachs also dropped.
The S&P 500 index faced selling pressure last Friday, with S&P 500 index futures falling by 1%, marking a loss for the month of February. During early trading on Monday, Dow Jones Industrial Average futures dropped by 511 points, a 1% decline, while Nasdaq 100 index futures fell by 1.3%. The Chicago Board Options Exchange Volatility Index (VIX), which measures market volatility, soared to its highest level since 2026.
Economists Ziad Daoud and Dina Esfandiary from Bloomberg Economics warned in their latest report that Iran supplies approximately 5% of global oil, and if Iranian oil is completely cut off, oil prices could rise by about 20%. Around 20% of the global oil supply is transported through the Strait of Hormuz and if it were to be closed, oil prices could soar to $108 per barrel.
The report pointed out that if oil prices continue to rise, major oil-importing countries including China, Europe, and India will be impacted, while oil-exporting countries like Russia, Canada, and Norway will benefit from the situation. As for the United States, the increase in fuel costs squeezing incomes may affect consumers, but as the US has become an oil exporting country due to shale oil, the overall economic impact on the US will be relatively minor.
Data from TD Securities estimates that China imports about 99% of its Iranian oil exports, accounting for approximately 13% of China’s total crude oil imports in 2025. Experts indicate that if Iranian crude supply is disrupted, China, in particular, would suffer the greatest impact, losing a source of cheap oil.
Due to the escalating conflicts in the Middle East and increasing tension in ship supplies, temporary rates for oil tankers from the Middle East to China have more than doubled since last Friday. According to shipbrokers, the preliminary rate for a Su…