From chaos to calm: how markets rode out the Iran-Israel war

Report by Theresia Rahme, English Adaptation by Karine Keuchkerian

The 12-day war between Iran and Israel rattled the global economy, but by the time it ended, markets had nearly returned to normal.

So, what happened?

On the first day of the war, oil prices surged, with a barrel reaching $78—the highest level since 2022. Had the conflict continued, some projections, including one from J.P. Morgan, estimated prices could have climbed to $130 per barrel.

Throughout the war, prices remained volatile, fluctuating between $76 and $72 amid rapid developments and fears of escalation or potential strikes on key oil infrastructure.

But once a ceasefire was reached, the news had a calming psychological effect on markets. Concerns eased over a possible closure of the Strait of Hormuz or attacks on oil facilities, reducing pressure on global markets.

As a result, Brent crude fell sharply to $66 per barrel—a positive development that helped ease inflationary pressures and rising consumer prices.

During the conflict, investors turned to gold as a safe haven, driving demand and pushing the price to $3,437 per ounce. But after U.S. President Donald Trump announced the ceasefire, prices retreated, with gold falling to around $3,323 per ounce.

This shift reverberated through stock markets, triggering a rebound across Asian, Gulf, and U.S. exchanges. Confidence in cryptocurrencies also returned after many investors had turned to cash during the conflict. 

As stability resumed, Bitcoin rose to about $106,000 after dipping to $103,000.