Oil spikes, safe-haven assets tumble as US and Iran ramp up threats

23rd Mar 2026 08:32

(Sharecast News) - Oil prices once again soared on Monday, while traditional safe-haven assets tumbled, as Washington and Tehran ramped up rhetoric over war in the Middle East - just days after Donald Trump insisted the conflict was winding down.

At the end of last week, the US president announced he was considering "winding down" the war in Iran, and that it was now up to other nations to guard the Strait of Hormuz. Posting on social media on Friday, he said the US was "getting very close to meeting our objectives".

But by Saturday night, he was threatening a massive attack on Iran's power plants if Tehran didn't reopen the Strait of Hormuz by around midnight on Monday. In response, Iran warned it would target vital infrastructure across the Gulf.

By 0900 GMT on Monday, benchmark Brent crude had spiked 2% at $114.04 a barrel, while West Texas Intermediate was 2% higher at $100.16.

Traditional safe havens, meanwhile, tumbled, as investors took flight. Comex gold - which had topped $5,400 early in March - fell another 8% to $4,202.9, while silver and other metals, including platinum and palladium, were also sharply lower. Stock markets around the globe were also on the back foot, with the FTSE 100 shedding 2% within an hour of opening.

Neil Wilson, UK investor strategist at Saxo Markets, said: "Markets are increasingly pricing in not just energy disruption but long-term higher inflation and slower growth combined with a central bank policy mistake, lower liquidity, tighter financial conditions and so on.

"So while the best channel for financial markets to express war fears was initially via crude and gas prices, increasingly it's about stocks and bonds.

"We are entering a new and very dangerous phase for financial markets."

Bond markets are coming under pressure over fears central banks, previously focused on cutting rates, will now likely be forced to once again increase the cost of borrowing to tackle resurgent inflation.

The Bank of England held rates last week at 3.75%. Prior to the US attacking Iran at the end of February, it had been widely expected to trim them.

Richard Hunter, head of markets at Interactive Investor, said: "The trickle is running the risk of becoming a flood, as it is becoming increasingly evident that the short conflict investors had been pricing in remains totally elusive. Investors are running out of hiding places, with equities surrendering strong early-year gains, yields spiking higher and even gold suffering, given its inverse relationship with the dollar.

"Indeed, the strength of the dollar has negative implications for debt denominated in the currency - of particular interest to many Asian countries - while the oil price spike is not only inflationary but threatens to choke business investment and consumer confidence."