Economic Winners and Losers Emerge Six Months into Iran Conflict
POLICY WIRE — New York, USA — As the conflict between the U.S., Israel, and Iran enters its sixth month, the initial dire predictions of economic collapse have not materialized. However, the global...
POLICY WIRE — New York, USA — As the conflict between the U.S., Israel, and Iran enters its sixth month, the initial dire predictions of economic collapse have not materialized. However, the global economy has not escaped unscathed.
Investment strategist Michael Ashley Schulman of Cerity Partners remarked that the global economy has managed to avoid a financial disaster, comparing it to a ‘Mission Impossible’ scenario.
The war’s onset on February 28th caused immediate turmoil in stock markets, with the Dow, Nasdaq, and S&P 500 all experiencing significant drops. Yet, a remarkable recovery has since occurred, with the Dow up nearly 19%, the S&P 500 up almost 22%, and the Nasdaq surging 27%.
The International Monetary Fund noted in a July report that the economy is being influenced by two opposing forces: the war’s strain on growth and the enthusiasm for artificial intelligence.
While consumers face higher costs for fuel, food, and travel, Wall Street appears resilient. The conflict’s most direct economic impact has been on oil prices, with Brent crude rising from about $72 a barrel before the war to nearly $120, though it has since eased but remains 20% higher.
The rise in oil prices has significantly affected the airline industry, with jet fuel costs expected to be 70% higher than in 2025. Airlines have responded by increasing ticket prices, baggage fees, and implementing fuel surcharges, leading to reduced flights and route cancellations.
The war has also accelerated the shift towards clean energy, with record sales of electric vehicles in regions like Singapore, New Zealand, and Colombia. Globally, EVs are projected to make up 29% of total vehicle sales in 2026, up from 25% the previous year.
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Countries heavily dependent on Persian Gulf oil have increased their use of renewable energy and explored nuclear power options. Supply chain expert Scott Lehmann of Sphera noted that 26 countries and regions have announced clean energy and electrification measures in response to the war.
The conflict has had a particularly harsh impact on the poorest populations, with soaring fertilizer prices affecting farmers and potentially threatening future harvests. The United Nations World Food Programme has warned of increased hunger, with higher transportation costs further complicating humanitarian efforts.
President Donald Trump’s family has seen financial benefits from the conflict, with military contractors and private equity firms associated with his sons securing lucrative contracts. The president’s own investment portfolio has also profited from shares in military suppliers and oil and gas stocks.
Reporting by Policy-Wire (PW)
