The tensions that began with the US and Israeli airstrikes on Iran have emerged as a multifaceted development that goes beyond being a regional military crisis, deeply shaking both the global economy and energy markets. This conflict demonstrates that wars not only create costs but also provide significant economic gains for certain actors.
According to Al Jazeera, approximately one-fifth of global crude oil and natural gas supply has been suspended due to the conflict. This situation has caused severe supply shocks in energy markets, pushing prices higher (Al Jazeera, 2026).
Pressure on the Global Economy
Before the war, the International Monetary Fund (IMF) had projected global economic growth for 2026 at 3.3%. However, according to CNN’s analysis, the uncertainty caused by the conflict in the Middle East and the rise in energy prices have caused this growth forecast to be downgraded, particularly creating serious risks for European economies. In fragile economies such as the UK, growth expectations have fallen to as low as 1.1%, with concerns about a potential rise in inflation (CNN, 2026).
Energy Market Shocks and Security Concerns
According to a report by CSIS, the reduction of tanker traffic through the Strait of Hormuz by 90% has significantly disrupted global oil and gas supplies. Qatar’s indefinite halt of liquefied natural gas production has deepened concerns about supply. Given the global structure of energy markets, this has the potential to significantly increase energy bills for households in countries like the UK. Experts estimate that UK households may face an increase of over £500 in their annual energy bills (CSIS, 2026).
According to Reuters, alongside the energy shock, stocks on the London stock exchange have fallen, and pressure on the pound has intensified. This is seen as a serious risk that could narrow the financial space for the UK government (Reuters, 2026).
Defence Sector Gains
The negative market outlook does not apply to all sectors. Shares of defence companies have risen since the first days of the conflict. London-based BAE Systems saw its shares rise by approximately 6%, while US defence giants such as Lockheed Martin, Northrop Grumman, and RTX experienced share increases ranging from 4% to 6%. The combined market value of these companies increased by between $25 to $30 billion in just the first few days. In Israel, Elbit Systems’ shares have risen by nearly 45% since the beginning of the year, making the company one of the country’s most valuable publicly traded firms (İndytürk, 2026).
Political Implications and Social Unity
It is known that wars can provide short-term advantages for political leaders. Some political debates that preoccupied the global agenda before the crisis have quickly receded into the background following the attacks. Experts describe this as the “rally round the flag” effect (İndytürk, 2026).
Economic and Power Dynamics Within Iran
One of the most striking paradoxes of the conflict in Iran relates to the country’s internal economic structure. The Islamic Revolutionary Guard Corps (IRGC) controls a significant portion of Iran’s oil exports as well as major companies in sectors such as construction, energy, and telecommunications. While the purpose of sanctions is to weaken the Tehran regime, some analyses suggest that these measures have strengthened the economic networks associated with the IRGC. Furthermore, according to World Bank data, during the period of intensified sanctions from 2011 to 2020, nearly 10 million Iranians fell below the poverty line (İndytürk, 2026).
New Dynamics in Energy Geopolitics
The rise in oil and gas prices has led to different outcomes for various countries. While the US is expected to increase energy exports to Europe, the war could also create an indirect advantage for Russia. Major buyers such as India and China are turning to alternative suppliers. The situation is more complex for Gulf countries; while Saudi Arabia and the UAE possess significant spare production capacity, countries such as Kuwait, Qatar, and Iraq, which rely heavily on the Strait of Hormuz, are more exposed to the risks of the conflict (BBC Türkçe, 2026; İndytürk, 2026).
Effects on the Green Energy Transition
The rise in energy prices has a dual effect. On the one hand, it encourages investments in renewable energy, but on the other hand, it makes oil and gas production more profitable, increasing interest in fossil fuels. This poses a risk of slowing down the global energy transition. Economists refer to this situation as the “paradox of incentives”: while ending wars may seem rational for societies, some powerful actors directly benefit economically or politically from the continuation of the conflict (Yeni Şafak, 2026).
Conclusion: The Paradox of the Conflict and Its Economic Costs
The cost of the shock in energy markets has already begun to be calculated. Experts suggest that these costs will soon be felt not only in the markets but also in national budgets and household bills. The key element that makes resolving the crisis particularly difficult is the following paradox: the actors most capable of ending the conflict are also in the best position to profit the most from its continuation (Euronews, 2026; Yeni Şafak, 2026).
Sources
- Al Jazeera, “Iran war threatens prolonged impact on energy markets as oil prices rise,” 2026.
- CSIS, “What Does the Iran War Mean for Global Energy Markets?”, 2026.
- CNN, “How the Middle East war could hurt the global economy,” 2026.
- Reuters, “US-Israel war with Iran sends shockwaves through global business,” 2026.
- Euronews, “Iran war shocks continue to ripple through the global economy,” 2026.
- Yeni Şafak, “US and Israel threaten all life: Energy, water, and food crises are imminent,” 2026.
- İndytürk, “The regional and global geo-economic impacts of the Iran war,” 2026.
- BBC Türkçe, “Can rising oil prices shake the whole economy?”, 2026.
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