Global economists and market experts anticipate far-reaching repercussions from the Middle East conflict.
The situation raises concerns about the potential for oil price surges, increased capital flow into safe havens, and involvement of other nations.
Israel’s preparations for a ground assault in the Gaza Strip have already impacted asset prices. Stocks, like the S&P 500, saw a decline of 0.5%, while safe haven assets, including gold, surged over 3%.
Oil prices increased by nearly 6% as investors assessed potential supply disruptions from the region.
An expanding conflict may lead to rising inflation, and subsequently, interest rates globally.
Nevertheless, the United States could be an exception, attracting foreign investment as a safe haven during global turmoil, potentially leading to a stronger dollar.
The situation could affect various fuels, exemplified by Chevron’s halt of natural gas exports via a major subsea pipeline between Israel and Egypt.
The greatest concern in the oil market remains the involvement of neighboring countries, further exacerbating the situation.
While rising oil prices may not significantly impact U.S. gas prices or consumer spending immediately, the situation remains fluid and uncertain.
(Source: Reuters)
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