The conflict in Iran is significantly impacting global markets. President Trump indicated a prolonged U.S. campaign could pressure the economy through inflation due to higher oil prices.
US manufacturing input costs jumped, reaching their highest level in nearly four years before the latest Iran attacks. The war has halted oil tanker traffic through the Strait of Hormuz, pushing crude prices sharply higher. Experts warn of potential untold damage to the global economy, even if the conflict ends soon, citing ongoing logistical bottlenecks and production ramp-up delays.
While initial fears of an energy supply shock eased slightly on reports of indirect talks, oil prices surged again after Iran reportedly attacked a tanker. U.S. crude briefly broke $78 per barrel, its highest level since mid-2025, with prices up approximately 15% for the week. Approximately 20% of global oil consumption is exported through the Strait of Hormuz.
The U.S. labor market showed signs of strain, with the economy losing 92,000 jobs in February and the unemployment rate rising to 4.4%. Employment in healthcare declined due to large nurses' strikes, and winter storms impacted construction jobs.
Global oil benchmarks, including Brent crude, broke above $90 a barrel amid the Iran war. Officials warn that if tankers remain unable to pass through the Strait of Hormuz, crude prices could reach $150 per barrel, potentially collapsing world economies.