NEW YORK (AP) – In the initial stages of the conflict following the U.S. and Israel's decision to bomb Iran on February 28, 2026, alarmingly heavy predictions emerged about the potential fallout of the war, including rising oil prices, a worldwide recession, and economic turmoil. However, as of six months into the conflict, these extreme forecasts have not materialized, despite the global economy feeling the impact of the war.
Michael Ashley Schulman, an investment strategist with Cerity Partners, remarked, “So far, the global economy has pulled off the financial equivalent of a 'Mission Impossible' scene.” An analysis of how the global economy has coped with the war reveals a mixed landscape of winners and losers.
Winner: Investors Who Stayed Calm
The initial chaos triggered by the conflict severely affected stock markets, with oil prices surging and Wall Street experiencing a sharp decline, leading to five consecutive weeks of losses. The Dow and Nasdaq faced corrections, while the S&P 500 had its worst month since 2022. However, a significant market turnaround occurred after the bottom in late March, with the Dow rising almost 19%, the S&P up nearly 22%, and the Nasdaq surging 27%. The International Monetary Fund noted a complex scenario where inflation and war-induced strains on growth were countered by enthusiasm in artificial intelligence, leading to resilience in the market despite Main Street feeling the pinch from rising costs.
Loser: Travelers
The war's direct impact on oil prices has been stark, particularly affecting anyone who travels. The price of Brent crude skyrocketed from approximately $72 a barrel before the war to nearly $120, with costs still 20% higher than pre-war levels. Airlines have responded to increased fuel prices by raising ticket costs, introducing additional fees, and cutting flights, with significant reductions observed at companies like Lufthansa Group and Spirit Airlines. Airlines are expected to maintain elevated prices, resulting in less choice and reduced competition for consumers.
Winner: Advocates for Clean Energy
The crisis has simultaneously bolstered the clean power sector, escalating sales of electric vehicles (EVs). Record earnings were recorded in various regions, with EV sales escalating by 110% in Singapore, 180% in New Zealand, and 300% in Colombia. Additionally, a collaborative push for renewable energy is underway in many Southeast Asian countries, with increased research into nuclear power, solar panel installation in Africa, and a notable interest in developing domestic refining capabilities among those reliant on Gulf oil.
Scott Lehmann of Sphera noted that at least 26 countries and regions have embraced clean energy measures bolstered by the conflict, emphasizing that “the crisis is forcing investment faster than any policy framework would have.”
Loser: The Battle Against Hunger
The war's repercussions have not been uniformly negative; for some, like wealthier investors, the impact is minimal. However, the poorest populations are profoundly affected. The Gulf region's role in fertilizer production has led to soaring prices, peaking at 44% higher than pre-war levels according to the World Bank. Consequently, farmers have been compelled to reduce their fertilizer use, jeopardizing future crop yields. The United Nations World Food Programme has warned that millions may face hunger due to the strangulation of fertilizer exports, which adversely affects food prices worldwide.
Winner: The Trump Family's Business Interests
As the war has exacted a toll in economic and human costs, family businesses linked to President Donald Trump have benefited. Military contractor Powerus, on the verge of going public through Eric and Donald Trump Jr., secured an Air Force contract worth up to $90 million. Investments in military contractors, including Don Jr.'s involvement with 1789 Capital Management, have yielded lucrative contracts. Additionally, the president's investment portfolio has seen significant gains from military suppliers and oil stocks, raising concerns about potential conflicts of interest.
The conflict has influenced public opinion ahead of midterm elections, posing challenges to the president despite personal financial gains. Recent reports indicate that Trump's asset values in oil and gas stocks have surged by approximately $15.5 million.
The situation remains fluid as the ramifications of the conflict continue to unfold, creating a complex landscape in which different sectors and populations feel the effects in varying degrees.
