Iran Archives

The Federal Reserve Keeps Interest Rates on Hold

Written by IntaCapital Swiss on March 19, 2026. Posted in Iran, News & Reports. Leave a Comment

Today, the FOMC voted 11–1 to maintain its benchmark interest rate at 3.50%–3.75%, marking the second consecutive meeting of unchanged policy. The one dissenting vote came from Governor Stephen Miran, who called for a rate reduction of 25 basis points. Policymakers acknowledged that due to the Iranian conflict in the Middle East, they now face increased uncertainty on how this will impact the economy, with Chairman Powell stating in a post-meeting press conference, “The thing I really want to emphasise is that nobody knows.”

Inflation Outlook and Rate Cut Criteria

On the inflation front, officials have raised their outlook in 2026 from 2.40% to 2.70%, still above the Federal Reserve’s target of 2.00%, and analysts point to the fact that inflation figures have been above target for the last five years. Chairman Powell advised that they need to progress in reducing inflation in order to lower interest rates, saying that, “If we do not see that progress, then we won’t see the rate cut.” He went on to point to goods inflation that had increased due to tariffs, and indeed officials pointed to core inflation (excludes food and energy prices) which they also indicated will rise to 2.70%.

Energy Volatility and Meeting Deliberations

In the post-meeting press conference, Chairman Powell was questioned on rising oil prices. He noted that policymakers typically look through energy spikes, as such fluctuations often have only a transient impact on long-term inflation. The Chairman also advised that the possibility of a rate hike was discussed at some stage, but was quick to point out that most members of the FOMC did not see this as their base case. As usual, President Trump had called for a rate cut, but with the current events in the Middle East and current inflation figures, this seemed hardly likely to be on the FOMC’s agenda which of course was borne out by their vote.

Market Expectations and the “Dot Plot”

Financial markets had priced in a near 100% bet that the FOMC would hold rates this time around. Currently, consensus pricing reflects a 94% to 95.7% probability of another hold at the upcoming April meeting. Experts suggest that money market sentiment will be only one more 25 basis points this year, most likely in either September or December. The FOMC uses the “Dot Plot”* as a major guide to future interest rate decisions, and currently analysts advise that consensus has shifted toward higher-for-longer with 14 of the 19 members now predicting no change or just one cut.

*Dot Plot – This is a chart that is published by the Federal Reserve that shows where each FOMC member expects interest rates to be in the future, with each dot representing one policymaker’s projection as to where the Federal Funds rate will be at the end of any given year, with the median dot receiving the most attention. Financial markets read and assess the implications of the dot chart and if the median dot shifts higher, then it may be interpreted as a hawkish stance. If it moves lower, it can be interpreted as a dovish stance.

Leadership Succession and DOJ Investigation

Finally, and in a surprising statement regarding his immediate future, Chairman Jerome Powell stated that he had no intention of resigning as a member of the Federal Reserve’s Board of Governors until the investigation by the DOJ (Department of Justice) into the Fed’s building renovation is over. He went on to state that his Chairmanship ends this May, and if his already presidential nominated successor (Kevin Warsh) is not confirmed by the Senate by the end of his term, he will stay on as a chair pro tempore. In the past, the Federal Reserve has approved such a nomination. As one Senator has promised to withhold his vote until the DOJ investigation is dropped, no doubt this will increase President Trump’s angst towards Chairman Powell.

Russia is Reaping the Rewards from the Iranian Conflict

Written by IntaCapital Swiss on March 18, 2026. Posted in Iran, News & Reports. Leave a Comment

While the U.S. and Israel continue their military operations to undermine the Iranian government, Tehran’s drone and missile capabilities remain a persistent threat to the Gulf States. With the Strait of Hormuz now largely closed to commercial shipping, the global economy faces a mounting energy crisis with no immediate resolution in sight. Oil prices continue to spike and so the White House has lifted sanctions (30 days only) on those countries who wish to buy oil from Russia, thereby enabling the Kremlin to fill their coffers and fund the on-going invasion of Ukraine.

The Kremlin’s Strategic Windfall: Market Benchmarks and Sanction Waivers

While the current international climate provides President Putin with renewed regional leverage, observers note that U.S. diplomatic maneuvers have largely foreclosed any near-term opportunity for a negotiated settlement with Russia. Data released shows that Putin is enjoying a win-double as Russian export prices have spiked thanks to the global oil benchmarks going through the roof due to the US-Israel-Iran conflict. If the conflict is not resolved soon, experts suggest that further sanctions easing could well become a reality. And indeed, the current waiver has helped clear a flotilla of tankers that are full of Russian crude oil, of which many are now heading or have arrived in India.

Friction Within the Alliance: Kyiv’s Response to U.S. Policy Shifts

Ukraine and its allies in Europe have slammed the decision by the White House to partially waive sanctions against Russia, as the Strait of Hormuz remains closed to tanker traffic. Indeed, analysts advise that American efforts to bring the Russian/Ukraine war to end have stalled, and Ukrainian President, Volodymyr Zelensky, said that the sanctions lifting will strengthen Russia’s hand. President Zelensky went on to say, “Just this easing by America could provide Russia with around $10 Billion for the war. This certainly does not help peace.”

European Security Concerns: Diverging Perspectives in the G7

A number of European leaders have spoken out against the US administration, easing sanctions on Russia with the president of the European Council, Antonio Costa, saying, “The move is very concerning as it impacts European security.” The German Chancellor, Friedrich Merz, said, “Easing of sanctions now, for whatever reason, is wrong. We believe that is the wrong course of action, after all we want to ensure that Russia does not exploit the war in Iran to weaken Ukraine.”

Quantifying the Conflict: Fossil Fuel Revenue and Military Capacity

Experts advise that whichever way you look at it, Russia has definitely profited from the Iranian conflict, not only from the spike in oil prices but also from the 30-day waiver in sanctions on those countries buying Russian crude. A German NGO, known as the Centre for Research on Energy and Clean Air, says that Russia has so far earned circa Euros 6 Billion from fossil fuel exports since strikes on Iran began on 28^thFebruary 2026. They went on to say that current levels of earnings by Russia from fossil fuels allows them to buy circa 17,000 Shahed, 136 attack drones every 24 hours, and analysts advise that sanction waivers could push this total even higher.

The On-Going Effect of the US-Israel-Iran Conflict

Written by IntaCapital Swiss on March 18, 2026. Posted in Iran, News & Reports. Leave a Comment

The on-going Iranian conflict is affecting many aspects of life across the globe, the most notable being the price of oil and its derivatives. The price of oil remains very volatile, a week ago today the price opened at circa $120pbl and closed at circa $81.50pbl, and today Brent Crude is trading at above $104pbl.

The knock-on effect will be felt by consumers across the globe as prices go up for heating, fuel at the pumps, food etc. Governments will be keeping a watchful eye on their own CPI (Consumer Price Index), as inflation will once again begin to rise. However, as outlined below, it’s not just the cost of crude oil that the conflict is pushing up.

Fertilizer Crisis

Fertilizer is essential for food production, however, just before spring which is many farmers’ planting season, the Iran Conflict is pushing up the cost of nitrogen products such as urea and ammonia. Urea for example is primarily used as a highly concentrated nitrogen fertilizer that promotes vigorous plant growth and has a nitrogen content of 46%, an essential tool for modern farming. Due to the current conflict, the price of Urea has surged by circa 34% to $600/T, and this together with other essential raw material will mean higher prices in the supermarkets with farmers across the globe rushing to secure critical fertilizers.

Palm Oil

Due to the on-going Iranian crisis, Palm Oil futures are now over $100pbl as prospective demand for biofuel feedstocks spike and is almost at a parity with gasoil*. Palm oil is a versatile vegetable oil found in nearly 50% of packaged supermarket products. It is also a key ingredient in cosmetics, cleaning supplies, and biofuels, and is frequently added to livestock feed, especially in the dairy industry, due to its exceptionally high energy content.

*Gasoil – (AKA red diesel or tractor diesel) is a low-duty, red-dyed fuel identical to regular road diesel but restricted to off-road industrial, agricultural and heating use. It is a middle distillate derived from crude oil refining, primarily powering machinery such as tractors, cranes and generators.

Global Food Supply

Farmers across many regions including Europe and Asia, are vulnerable to an oil and gas crunch due to the Iran conflict, and the scarcity of fuel will make it difficult to operate essential farm machinery. For example, in Bangladesh, farmers are unable to start their irrigation pumps due to the lack of diesel. In Australia, it is almost the planting season, and farmers have been advised of fuel delivery cutbacks. In the Philippines, it is predicted that fishermen and boat owners will not be able to go to sea.

Europe is also vulnerable, for example in Germany 100 litres of diesel is up by EUR 30, and in Romania, farm diesel prices have jumped about 30%. A UK farmer highlighted that existing diesel stocks will be exhausted by mid-spring. Beyond that point, agricultural operations will be forced to pay the prevailing market rate, provided that fuel supplies remain accessible.

Fuel Oil

Fuel oil powers container ships and is the backbone of globalisation, however, the price of this commodity is skyrocketing. Fuel oil is also known in the industry as the “bottom of the barrel”, and is usually cheap, flying under the radar compared to the more well-known fuels (that get distilled higher up petroleum distillation towers) such as gasoline, diesel and jet fuel.

The shipping industry is now sounding the alarm as it’s not only the price of fuel oil that is worrying, some of the key ports across the globe may run out of stock forcing bulk carriers and container ships to halt in their tracks. Recent data released shows that fuel oil in two of the top three bunkering locations (Fujairah UAE and Singapore) are beginning to run very low on stocks. If the conflict continues for a couple months, fuel oil will become a major problem.

Conclusion

Analysts warn that if geopolitical tensions are not resolved swiftly, the global cost-of-living crisis will intensify, potentially causing inflation to become entrenched across G7 economies once again. This means that central banks may be forced to increase interest rates, thereby increasing the cost of borrowing, energy and food, which will be very hard on consumers.

The Reserve Bank of Australia Hikes Interest Rates

Written by IntaCapital Swiss on March 17, 2026. Posted in Iran, News & Reports. Leave a Comment

Today, the RBA (Reserve Bank of Australia) raised its key interest rate by 25 basis points from 3.85% to 4.10%, with the nine-member policy committee voting by 5 – 4 in a split decision. In 2023, officials delivered three rate cuts, and today’s first back-to-back rate hike since 2023 reverses two of those three cuts. After the vote, Governor Michelle Bullock advised that the Iranian conflict in the Middle East represented part of the decision to hike rates, but pointed out that prices still remained too high.

The Deputy Governor of the RBA, Andrew Hauser, has already echoed the Governor’s words in a statement last week when he advised that price rises driven by the Iranian conflict would not be helpful in combating inflation. Experts suggest that a rise in interest rates was on the cards, and perhaps the on-going conflict in the Middle East fuelled the debate as to whether to hike interest rates now or at the next policy meeting.

In February this year, officials from the RBA had forecasted that the CPI (Consumer Price Index) would peak at 4.2%, this was partly based on the technical assumption that crude oil would remain at circa $63.8pbl through to 2028, but today, Brent Crude is trading between $103pbl – $104pbl. However, the Treasurer of Australia, Mr James Chalmers, has announced that he anticipates inflation rising to 4.5% and that households can expect increased cost of living expenses. Today, he went on to say that Australia already had an inflation challenge, but the war in the Middle East is making this challenge worse.

Many experts and analysts are expecting another 25-basis point hike in May, and if the Iranian conflict is still going on and oil surpasses the $150pbl mark, the increase could be even higher. Elsewhere in Indonesia, BI (Bank Indonesia) held its benchmark interest rate (BI-Rate) at 4.75% marking a continued stance of stability amid the on-going Middle East conflict and other geopolitical and geo-economic unrest. However, the Middle East conflict has brought Asia and South East Asia to the forefront of the oil crisis and only time will tell how their economies will react.

The Trump Factor: Navigating Oil Volatility, Interest Rates, and the Iran Conflict

Written by IntaCapital Swiss on March 12, 2026. Posted in Iran, News & Reports. Leave a Comment

The Emergence of a New Financial Fundamental

Experts advise that President Donald Trump has now become a financial fundamental*. Based on market analysis between early 2025 and today, his public statements, executive actions and social media posts have acted as immediate drivers of financial market volatility. Analysts now suggest that President Trump acts as a fundamental factor that traders and investors must track in order to manage risk. A recent example was President Trump’s announcement that the war would be ending soon, sending the US Dollar up and gold and crude oil down.

*Financial Fundamentals – Geopolitical and economic data or statements released into the financial world that affect the prices of commodities, bonds, currencies, interest rates, futures etc., depending on the interpretation by traders and investors.

Market Reaction to Geopolitical Tension

This week, market volatility has been rampant following mixed messages regarding Iran. Oil prices opened Monday by skyrocketing to over $120/bbl, while US stock futures initially tumbled. However, after President Trump announced the conflict would soon end, the S&P 500 posted its largest one-day rally in a month, while oil plummeted back below $90/bbl.

Volatility and the Fear Gauge

Trump continues to fan the flames of market volatility, which has reached its most intense levels since the ‘Liberation Day’ tariffs of last April. Reflecting this turbulence, the VIX (Cboe Volatility Index) surged past the 35 mark on Monday, more than doubling its value since the start of the year.

*Cboe Volatility Index – The Chicago Board Option Exchange Volatility Index was introduced by Cboe Global Markets in 1993 and is referred to as VIX. This is a market index that measures the implied volatility of the S&P 500 Index (SPX) – the core index for United States equities.

Crude Oil and the Strait of Hormuz Crisis

Brent Crude Oil has also seen wild fluctuations this week, spiking at just under $120pbl on Monday and dropping to a low of $81.16pbl on Wednesday. This was due to mixed messages from the White House with Energy Secretary Chris Wright, who posted then deleted a message confirming the US Navy had successfully escorted a tanker through the Strait of Hormuz, which as it turned out was blatantly untrue. The Strait of Hormuz, the critical gateway out of the Persian Gulf, remains closed and as such, oil is currently trading at $92.54pbl.

ECB Policy and Inflationary Pressure

Elsewhere, officials of the ECB (European Central Bank) have suggested that the next meeting of the Governing Council might see a change in policy towards interest rates. Currently, an increase in policy rates may be on the cards as they keep an eye on inflation. Interest rates are currently hovering around the ECB’s benchmark target of 2.00%, but analysts advise that money markets have increased bets on the tightening of monetary policy, as energy costs skyrocket putting upward pressure on inflation.

Central Bank Caution Amidst Global Uncertainty

Christine Lagarde, President of the ECB, has assured the Eurozone that the bank will act to prevent another inflation crisis similar to the one sparked on 24th February 2022 when the Russia-Ukraine conflict began. President Lagarde also stated, “Today there is so much uncertainty that I’d be incapable to say what we will decide at the upcoming policy meeting (18^th – 19^th March). We won’t rush into a decision because there is too much uncertainty, too much volatility.” While many observers agree with this statement, market analysts suggest that global stability would be much easier to achieve if President Trump and his administration moved away from the erratic rhetoric that continues to destabilize the markets.

The UK is at Risk of Inflation and Energy Spikes Due to the Iran Conflict

Written by IntaCapital Swiss on March 11, 2026. Posted in Iran, News & Reports. Leave a Comment

Rising Borrowing Costs and Market Volatility

The United Kingdom’s borrowing costs are going up with great rapidity as the country is exposed to a surge in inflation due to the current war in the Middle East between Iran, the United States and Israel. The potential inflation crisis has been reflected in the UK’s increased cost of borrowing as the benchmark 10-year Gilt* yield rose 10 basis points on Friday 6^th March.

*10-year Gilt (Government Bond) – Represents the yield/interest rate the government must pay to borrow money for ten years. It is referred to as the benchmark as it reflects investor sentiment on the health of the UK economy and future Bank of England policy decisions.

Energy Security and Domestic Policy Vulnerability

The UK’s Energy Secretary, Ed Miliband, said that after an extremely serious drop-off in tankers transiting the Strait of Hormuz, the country is now at the mercy of international energy markets.

The Iran crisis has exposed significant vulnerabilities in the Labour government’s energy strategy. By retreating from North Sea oil in favor of current green policies, the UK’s heavy reliance on imported fuel has been thrust into a harsh spotlight. Whilst the costs will not be seen by household bills immediately, the inevitability of upcoming increases will soon filter through leaving residents of the UK further out of pocket.

Impact on Petrol and Diesel Prices

At the pumps, diesel has surged to a 16-month high, rising by approximately 6p to 148p per litre, a level not seen since August 2024. Petrol prices followed suit, climbing by 4p to an average of 137p. For the average consumer, this translates to an additional £2.00 to fill a 55-litre petrol car, while diesel owners are facing an increase of roughly £3.30 per tank.

Shifting Expectations for Bank of England Policy

Elsewhere, analysts report a significant shift in expectations for the Bank of England’s March 19th policy meeting. While markets were previously almost certain of a 25-basis point cut, the ongoing conflict has prompted a major reprice, with holding interest rates now seen as the most likely outcome. Experts advise that due to the surge in energy prices, inflation could return to 3.5% later in the year, and if Brent Crude continues to increase (up circa 27% last week), the cost of living for consumers will continue to increase.

Is the Iran Conflict Affecting Financial Markets Views on Interest Rates

Written by IntaCapital Swiss on March 11, 2026. Posted in Iran, News & Reports. Leave a Comment

Analysts advise that last week, the financial markets were very in agreement regarding the ECB (European Central Bank) not increasing interest rates this year, however with the Iran conflict potentially pushing inflation up in Europe, the consensus is now that the ECB could well hike interest rates this year. In fact, money market pricing currently indicates a 100% probability that the ECB will implement an interest rate hike, and this sentiment has led German Bunds (German Government Bonds) to close in on their worst week since 2023. If interest rates are hiked, this will affect the consumer in regard to mortgages, costs of living including electricity, food and gas, plus the cost of borrowings by consumers.

Experts advise that ECB policy makers are wary of a repeat of 2022, when energy prices soared due to the Russian invasion of Ukraine on 24th of February 2022. The resulting inflation spike lasted longer than anticipated, exposing the Eurozone’s vulnerability to energy shocks. As the region relies heavily on gas and oil imports from the Middle East and the U.S. to power its industry and heat homes, it remains highly exposed to global price volatility. However, some experts believe the markets are overreacting, as back in 2022, rates were close to zero and supply chains were severely disrupted. Today, inflation is close to the ECBs target of 2%, and the duration of the conflict is paramount before taking any interest rate decisions.

How The Iran Conflict is Affecting Global Travel as Airline Prices Rocket

Written by IntaCapital Swiss on March 10, 2026. Posted in Iran, News & Reports. Leave a Comment

Disruption to Major Middle Eastern Hubs

The ongoing war has affected major airline hubs in the Middle East with major Gulf carriers such as Emirates, Qatar Airways and Etihad effectively being grounded. According to data released, this has reduced daily international flight capacity by over 10%. Analysts advise that since the conflict began, global flight cancellations to the Middle East are now in excess of 23,000, which has led to other airlines experiencing a surge in reservations. In some cases this has resulted in airfares increasing by up to 900%.

Surging Fares and the Shift to Asian Carriers

Experts advise that Singapore Airlines and Cathay Pacific Airways are two of the best positioned Asian carriers to face down the travel problems created by the current conflict, as passengers flock to Asian airlines to obtain seats between Asia and Europe. In fact, currently, a one-way economy ticket on Singapore Airlines from Heathrow to Singapore has been advertised at US$ 8,450, which experts advise is a 900% increase on fares later in the month. A similar ticket from Heathrow to Hong Kong, which was advertised two weeks ago at HK$ 5,670 is today costing HK$ 26,737.

Energy Security and Global Market Volatility

China has instructed major refiners to halt exports of gasoline and diesel, and Indian refiner MRPL has advised customers they are halting the export of oil products as these countries along with others seek to protect domestic consumption. With regard to stocks and shares, the Kospi Index in Seoul, which is seen as one the world’s hottest stock markets, took a major beating with a 12% drop yesterday, preceded by 7.2% the day before, being the worst sell-off since 2024 due to Iran war risks. European stocks are slightly higher today, but traders’ attention is focused on the Middle East conflict and the effect a prolonged war will have on shares.

Impact on Global Food Supplies and Supermarket Prices

Supermarket bills are also set to increase as the closure of the Strait of Hormuz has halted 1/3 of global fertiliser supplies, with such exports from Iran of walnuts, almonds, pistachios ,dates and saffron all expected to increase if the conflict does not stop soon. However, on the beef and poultry front, Brazil’s exports could be rerouted from the Middle East to Europe with analysts suggesting this could lead to lower prices for consumers within the EU and the United Kingdom.

How the Iran Conflict Could Affect a Business in the Transport Industry

Written by IntaCapital Swiss on March 10, 2026. Posted in Iran, News & Reports. Leave a Comment

The ongoing conflict involving Iran and regional powers has rapidly shifted from a geopolitical flashpoint to a global economic stress test — with profound implications for businesses in the transport industry. From disrupted trade lanes to spiking fuel costs and shifting demand patterns, transport companies must adjust to current market volatility and structural shifts in how goods and people move internationally.

Recent events — including military strikes on Iranian territory and Iran’s closing of the Strait of Hormuz — have combined to create both immediate disruptions and longer-term risks for transport operators, logistics planners, and global supply chains. This article examines those impacts in depth, focusing on maritime shipping, air cargo, land transport supply chains, insurance markets, and strategic responses for transport businesses.

Strategic Chokepoints and Route Disruption: The Strait of Hormuz

One of the most direct ways the Iran conflict affects transport industries is through disruption of critical maritime routes.

The Strait of Hormuz — a narrow waterway at the entrance to the Persian Gulf — is a linchpin of global energy and freight flows. Traditionally, about 20% to 30% of the world’s total daily petroleum liquids (oil, condensate and products) and circa 20% of global LNG (liquified Natural Gas) pass through this channel, and it also underpins a significant portion of container and bulk ship traffic. Data shows that just oil flow alone accounts for circa 20% of global oil (often exceeding 20 Million bpd) is shipped through the strait.

With Iran effectively blocking or threatening to block passage through the strait in response to escalating military hostilities, vessel traffic has been severely curtailed. Recent reports confirm that shipping traffic has “halted or been diverted” as insurers drop war-risk cover and carriers avoid the region. However, President Trump has announced that the US Forces stationed in the area may provide an escort to tankers passing through the strait.

For transport companies, especially those that operate container ships, bulk carriers, and tankers, this means:

Longer routes: Ships are rerouting around Africa via the Cape of Good Hope rather than traversing the shorter Suez Canal ↔ Hormuz route. This adds days or even weeks to voyages.
Increased fuel consumption: Longer sailings mean higher bunkering costs, reducing margins.
Scheduling chaos: Regular service loops and timetables are disrupted, affecting feeder services and inland distribution.

Even if traffic eventually resumes, the uncertainty and risk premium attached to Gulf passage will linger, discouraging carriers until the geopolitical landscape stabilises.

Rising Fuel and Freight Costs

Fuel is among the largest operating costs for transport businesses — especially shipping, aviation, and road freight. The Iran conflict, by escalating risk around oil supplies and increasing premiums for war-risk cover, has pushed prices higher across the board.

Key consequences include:

Spiking bunker fuel prices: As oil markets react to Middle East instability, bunker fuel costs surge, squeezing profit margins for shipping lines and logistics firms.
Freight rate inflation: Both ocean and air freight indexes have ticked up sharply as capacity shrinks and carriers pass costs on.
Higher ancillary charges: Some carriers are introducing conflict-related surcharges, particularly on routes that cross the Gulf or Red Sea.

For many transport businesses, these rising costs could force pricing adjustments, change in service offerings, or even strategic withdrawal from riskier routes.

Air Transport Disruption and Rising Insurance Costs

The conflict has not only affected maritime transport. Air cargo networks flying over or near the Middle East have been disrupted as airlines re-route to avoid dangerous airspace.

This has led to:

Longer air routes and greater fuel burn.
Reduced cargo capacity because fewer flights or aircraft are willing to traverse high-risk corridors — a trend that pushes freight rates higher.
Increased insurance premiums: Aviation insurers have also adjusted risk pricing for operations in proximity to conflict zones.

For smaller express and parcel carriers relying on global hubs in the Gulf, Middle East instability could reduce service frequency and reliability — impacting both delivery promises and customer trust.

Logistics Cascades: Delays, Capacity Shifts, and Supply Chain Spillovers

Transport businesses don’t operate in isolation. Disruption in one link of a supply chain — like ocean transit times — can cascade throughout the network.

Recent industry warnings indicate:

Delays at ports and inland hubs as goods stack up and carriers adjust bookings.
Modal shifts: Some shippers are shifting from sea to air freight to maintain delivery schedules, but air capacity constraints and high rates may soon push them back or force hybrid strategies.
Equipment shortages in key regions as containers and chassis get stuck far from origin markets.

These kinds of disruptions are especially taxing for just-in-time logistics systems, which lack inventory buffers and depend on predictable transit windows.

Insurance Markets: War Risk Cover Withdrawal

A direct consequence of elevated geopolitical risk is the withdrawal of war-risk insurance cover in affected waters. Major maritime insurers — including big European mutuals and UK firms — have ceased providing cover for tankers and cargo vessels operating in the Persian Gulf.

What this means for transport businesses:

Higher risk premiums: Operators now have to find alternative coverage at significantly increased cost or self-insure if they have the balance sheet.
Exclusion zones: Some insurers may exclude operations within specified nautical miles of conflict zones.
Risk pricing impacts: War risk pricing feeds into total freight cost — potentially eroding competitiveness.

In effect, the transport industry is being forced to internalise risks it previously externalised via insurance markets.

Business Travel and Passenger Transport

Tourism, business travel, and passenger logistics are also impacted. Rising oil costs translate into higher jet fuel costs (a large portion of airline expenses), which hit both ticket pricing and passenger volumes.

China, the Gulf states, and Europe all depend on Middle Eastern hubs for transit and business connections. Instability may reduce travel demand in and through these nodes, directly affecting:

Airlines and airports reliant on transit traffic.
Tour operators and booking agents servicing intercontinental routes.
Taxi, coach, and rail networks that feed into unstable international gateway cities.

Passenger transport isn’t as directly hit as freight, but sustained regional instability could remodel global travel flows over the long run.

Strategic and Long-Term Risks

Beyond immediate cost and operational disruptions, longer-term strategic risks for transport businesses include:

Shifts in global trade patterns: Companies may seek alternatives to conflict-affected routes, potentially boosting Eurasian rail corridors or bypass corridors through Africa.
Investment reallocation: Firms might prioritise infrastructure and assets in lower-risk geographies.
Technological acceleration: Investment in digital logistics, route optimisation, and predictive analytics to hedge risk and improve resilience.
Regulatory fragmentation: Sanctions or trade restrictions tied to the conflict could further restrict transport flows or require compliance changes.

In short, transport companies must think not just about today’s route but tomorrow’s geography of commerce.

What Transport Businesses Can Do

While the outlook is challenging, proactive firms are already adapting:

1. Risk-aware routing: Using real-time conflict intelligence to avoid hotspots and adjust schedules dynamically.

2. Diversified port and hub use: Reducing exposure to any one chokepoint by expanding node flexibility.

3. Fuel hedging strategies: Locking in fuel costs through hedges to manage volatility.

4. Insurance risk pooling: Exploring group coverage or self-insurance strategies to control rising premiums.

These strategic moves won’t eliminate risk, but they can blunt the economic impact and position companies to thrive in an uncertain landscape.

The Iran conflict has swiftly evolved from a regional geopolitical issue into a global economic event with wide-ranging consequences for the transport industry. With strategic chokepoints disrupted, fuel and freight costs rising, insurance markets recalibrating, and supply chain cascades unfolding, transport businesses face both immediate pressures and enduring strategic challenges.

Ultimately, the companies that adapt — by rethinking routes, rebalancing risk, and embracing flexibility — will be best positioned to navigate this period of disruption. The Iran conflict is a stark reminder that geopolitical instability can quickly transform the logistical landscape, and resilience must be central to any transport business strategy.

What Will Be the Effect on Oil Prices If the USA and Iran Go Into Battle?

Written by IntaCapital Swiss on March 3, 2026. Posted in Iran, News & Reports. Leave a Comment

Last week, on 26th February, negotiators from the United States and Iran met for the third time in Geneva in an attempt to reach agreement over the decades-long nuclear dispute between the two countries. However, by 28th February, in operations codenamed Operation Epic Fury (USA) and Operation Roaring Lion (Israel), the United States and Israel jointly conducted military airstrikes in Iran. The initial assault reportedly resulted in the death of Iran’s Supreme Leader, Ayatollah Ali Khamenei, along with several other senior political and military figures.

Iran is currently subject to international sanctions, and approximately 90% of its crude oil exports are purchased by China. According to data released by Kpler Ltd, a global data and analytics company specialising in real-time intelligence for the energy, maritime and commodities markets, Iranian crude exports reached approximately 1.25 million barrels per day in January this year.

Much of this crude oil is transported via a network commonly known as the “Dark Fleet”*, a group of ageing oil tankers that employ deceptive practices to bypass international regulations, sanctions and safety standards.

*The Dark Fleet is a large clandestine network of ageing oil tankers, shell companies and maritime service providers operating outside international regulations to transport sanctioned oil, primarily from Iran, Russia and, until recently, Venezuela. Analysts estimate the fleet comprises approximately 1,470 tankers that use tactics such as disabling tracking systems, forging documentation and conducting ship-to-ship transfers in open waters to evade sanctions.

The so-called Shadow Fleet is critical to Iran’s economy. Analysts suggest it transports millions of barrels of oil daily to China, generating billions of dollars annually. The United States government claims that a significant proportion of these revenues supports Iran’s nuclear programme, with roughly half of the exports reportedly under the control of the Islamic Revolutionary Guard Corps (IRGC).

Even before the latest escalation, rising tensions had pushed crude oil prices to a six-month high. As of Monday 23rd February, Brent Crude Futures settled at $71.66 per barrel. Following the outbreak of war in the Middle East, prices have risen to approximately $79.37 per barrel, representing an increase of around 8.5%.

Gas prices have also surged. Data from the EU natural gas benchmark shows prices rising by approximately 40% since Friday, reportedly after Qatar suspended LNG production and associated operations in Mesaieed Industrial City and Ras Laffan Industrial City following Iranian drone strikes.

Elsewhere, airline shares have fallen amid the conflict. International Airlines Group (owner of British Airways) declined by 6.6%, while EasyJet fell by 3.9%. The FTSE 100 also slipped by 1.2%. As expected, traditional safe-haven assets such as gold surged to $5,390, with some analysts suggesting it could climb towards $6,500 amid war-related uncertainty and inflationary pressures in the United States.

As previously warned by experts, if diplomatic talks failed the greatest risk lay in the potential closure or blockade of the Strait of Hormuz by Iran. The strait, only 21 miles wide at its narrowest point, links the Arabian Sea to the Persian Gulf and is widely regarded as the backbone of global oil supply. A significant proportion of crude oil exports from Iraq, Qatar, Saudi Arabia and the United Arab Emirates pass through this route.

The strait is now effectively closed, placing shipments of crude oil, liquefied natural gas (LNG) and liquefied petroleum gas (LPG) at serious risk. More than USD 500 billion worth of oil and gas passes through the Strait of Hormuz annually, meaning any prolonged disruption could expose the global economy to severe instability.

In response, the United States has assembled its largest concentration of naval and air power in the region since the 2003 Iraq War. Approximately 14 warships are currently deployed, centred around two carrier strike groups. The USS Abraham Lincoln is operating in the Arabian Sea, while the USS Gerald R. Ford, the world’s largest aircraft carrier, has recently arrived at Souda Bay in Crete in the Eastern Mediterranean.

Supporting vessels reportedly include nine guided-missile destroyers and three littoral combat ships, positioned across the Arabian Sea off Oman, the Red Sea and the Mediterranean. This military build-up echoes President Trump’s warning last Monday that if Iran failed to reach a deal with Washington, it would be “a very bad day for that country and, very sadly, for its people”.

With the United States and Israel now engaged in open conflict with Iran, the consequences for crude oil prices could be severe. Millions of barrels of crude oil, refined products and feedstocks shipped through the Strait of Hormuz are now at risk. Analysts suggest prices could spike dramatically, potentially reaching $130 per barrel.

Shipping costs are also rising. In June 2025, when the United States previously launched strikes in Iran, supertanker rates surged to approximately $76,000 per day, an increase of around 12%, for vessels carrying two million barrels of crude from the Persian Gulf to China. Data from the Baltic Exchange in London showed this was the highest level since March 2023, adding as much as $1.40 per barrel to shipping costs.

However, analysts argue that a prolonged war would not serve the interests of either the United States or Iran. Oil exports are vital to the Iranian economy, while higher global oil prices would quickly translate into increased petrol prices at the pump in the United States. With mid-term elections approaching in November, sustained fuel price increases could carry significant political consequences for President Trump.

Nevertheless, with hostilities now underway, daily market data indicates that oil and gas prices continue to rise sharply, with potentially far-reaching implications for economies worldwide.