Iran and Ukraine War; Apocalyptic Shocks to the Global Economy

The Iran and Ukraine wars are recognized as two main factors in creating economic shocks around the world. These conflicts have led to an increase in crude oil prices and other essential goods, and their effects have quickly spread to global markets.

Unprecedented Price Increases in Global Markets

The yield on 10-year U.S. Treasury bonds has surpassed five percent, indicating economic pressures stemming from the wars and market fluctuations. The Bloomberg Commodity Index has increased by 48 percent since the beginning of the year, and this increase includes various commodities such as energy, industrial metals, and grains. According to Eric Brouckhuyzen, head of the shipping division at Poten & Partners, "What is happening is truly unprecedented."

Read more: The $38 billion cost of the U.S. war against Iran and its implications for the economy

Impacts on Oil and Gas Markets

The cost of renting a supertanker on the Baltic Exchange in London has reached one million dollars per day, which is eight times its cost in January. The Brent crude oil futures markets have also been significantly affected by these conditions, with all futures contracts until spring 2027 trading above $90 per barrel. The prices of European gas futures for winter have stabilized at levels three times higher than last winter's prices.

These developments clearly indicate serious challenges in the shipping and freight transport sector, and the U.S. efforts to prevent escalating tensions seem inadequate. Especially considering that the Iranian Revolutionary Guard responds with countermeasures to each escalation of tension from the U.S.

Meanwhile, the East-to-West oil pipeline in Saudi Arabia has recently been targeted in an attack, adding more pressure to the oil market. U.S. oil reserves have sharply declined to 22 million barrels, indicating the scale of strategic failure in this area.

As wars and tensions continue, global markets are deeply concerned about the future. The price of diesel at U.S. fuel stations has increased from $3.72 to $6.23 per gallon over the past year. This price increase directly impacts inflation and the global economy and could lead to food shortages in the future.

Finally, the phenomenon of El Niño, which is forming, could exacerbate these crises. According to forecasts, this phenomenon will complexly and domino-like affect the global economy, likely intensifying existing problems.

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