The week began with a new rise in the commodity market. Brent rose to nearly $116 per barrel, WTI exceeded $102. The reason is the further escalation of the conflict around Iran and new statements from Donald Trump about possible actions against key oil infrastructure.
This is no longer just a reaction to weekend news. Oil is once again becoming the main benchmark for global markets.
Geopolitics push prices up.
The main factor is statements from Washington. Donald Trump allowed for the possibility of pressure on Hark Island, through which a significant part of Iranian oil exports pass.
At the same time, uncertainty around negotiations remains. Formally, the possibility of a deal is discussed, but the market does not perceive this as a near scenario.
The situation is exacerbated by threats from Iran. Risks to supplies through the Strait of Hormuz remain high, and this is one of the key routes of global energy resource trade.
The growth has already become systemic.
The current jump is a continuation of the strong movement of recent weeks. In March, oil gained dozens of percent, and the market is beginning to perceive this as a sustainable trend rather than a short-term reaction.
When growth becomes so large-scale, the very logic of investor behavior changes. They begin to factor in not local disruptions, but long-term supply constraints. Hence the discussions about a higher price range in the coming months.
Asia reacts faster than others.
The oil movement has hit Asian markets the hardest. Indices in Japan and South Korea have noticeably declined.
This is simply explained. These economies heavily rely on energy imports, so rising prices immediately affect company expenses and growth prospects. The market recalibrates future indicators. And does this quite quickly.
The crypto market is once again following macro trends.
Against the backdrop of rising oil prices, digital assets started the week with a drop. Bitcoin briefly fell below $65,000, then part of the movement was regained. Such a reaction is becoming habitual. First, a sharp downward movement, then an attempt to stabilize.
The main factor is not the oil itself, but the consequences of its rise. More expensive energy strengthens inflation expectations. This means that central banks will be more cautious about lowering rates. For bitcoin, this complicates the conditions. The market reacts worse to risk in an environment of expensive money.
Hark and Hormuz remain key points.
Hark Island and the Strait of Hormuz are now in the spotlight. Any actions around these points can quickly change the balance of supply in the market.
If risks to supplies persist, oil prices remain high. If tensions decrease, the market can quickly adjust. Therefore, these directions determine short-term dynamics.
What’s next?
The beginning of the week shows that the market does not expect a quick reduction in tensions. Oil continues to rise, and along with it, expectations for inflation and rates change. This affects all asset classes—from stocks to bitcoin.
As long as the situation does not stabilize, the commodity market will remain the main indicator. It is through this that investors assess the scale of risks and the prospects of the global economy.
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