Vance accuses Iran of ‘economic terrorism’ as US blockade comes into effect – industry analyst reaction

Raj Abrol, CEO of risk platform Galytix said

“A naval blockade of the Strait of Hormuz moves this from a price shock to a structural disruption of global trade. Twenty percent of the world’s oil, plus LNG, fertilisers and containerised cargo flow through that corridor. The impact goes well beyond energy prices — it ripples through shipping routes, insurance premiums, supply chains and input costs across every sector. Oil is back above $100, shipping rates on the Middle East to Asia route are at a six-year high, and war-risk premiums have spiked over 50%. Interest rates were already unpredictable, inflation was already reaccelerating, and credit spreads were already widening before today.

“This blockade only confirms that we should expect protracted volatility across all of these indicators, not a return to stability. That is the real challenge for lenders – when uncertainty becomes the baseline, the banks still relying on quarterly reviews and static risk models are flying blind. The knock-on effects do the real damage: a manufacturer whose input costs just jumped 30%, a logistics firm whose routes have doubled in length, an exporter who can no longer get cargo insurance at a viable price. None of that shows up in a filing until it is already a loss.”

 
Kenny MacAulay, CEO of accounting software platform Acting Office added,
 
“As the Iran crisis continues, surging inflation and higher rates are heaping fresh misery on homeowners and businesses alike. In tough times, doubling down with extra reserves and savings is critical for avoiding defaults, especially with the UK’s wider economic outlook stagnating.”
 
Daniela Hathorn, Senior Market Analyst, Capital.com said:
 
Markets are once again being pulled between competing forces, with geopolitical escalation in the Middle East reintroducing uncertainty just as investors turn their focus toward the start of earnings season. After a brief period of relief following ceasefire hopes, the breakdown in talks and the emergence of a “blockade of the blockade” strategy by the US has pushed the narrative back toward duration risk:  how long this conflict will last and how deeply it will impact the global economy.
The latest price action reflects that tension. Oil initially spiked on renewed supply fears but has since struggled to build on gains, trading in a relatively tight range despite the escalation in rhetoric. This lack of follow-through suggests markets are still grappling with how to price the situation, caught between the risk of further disruption to global energy flows and the possibility of another last-minute de-escalation. Under the surface, however, the physical market appears far tighter than futures imply, pointing to a disconnect that could eventually resolve with higher prices if disruption persists.
 
Brent crude daily chart
 

 
_{Past performance is not a reliable indicator of future results.}
 
Equities, meanwhile, have shown surprising resilience. The S&P 500 and Nasdaq have rebounded from recent lows and are attempting to stabilise, even as the macro backdrop deteriorates. Part of this strength can be attributed to easing volatility in bond markets and greater clarity around the Federal Reserve’s reaction function, namely, a willingness to look through supply-driven inflation shocks rather than aggressively tighten policy. That has helped compress risk premia and support valuations in the short term.
However, this resilience is increasingly being tested by the reality of what lies ahead. The upcoming earnings season is likely to be a critical inflection point. Expectations remain high, with analysts still projecting double-digit earnings growth in the near term and even stronger growth in the second quarter. This sets a high bar at a time when input costs, particularly energy, have risen sharply and growth momentum was already slowing prior to the conflict. If companies begin to signal margin pressure or revise guidance lower, the current optimism in equities could quickly unwind.