Tue 3 Mar: After the Bellš
Energy Shock Returns as Middle East Conflict Rattles Global Markets
ā¹ļøTodayās Performance tables.
Good evening,
The conflict in the Middle East escalated sharply, triggering a significant selloff in risk assets, with missile and drone attacks spreading across the region, disrupting air travel and drawing in Gulf states as embassies, airports and energy infrastructure were hit. Iranian strikes on energy assets marked a major escalation, forcing QatarEnergy to halt LNG production and Saudi Arabia to shut key oil facilities, triggering the largest surge in global gas prices since 2022 and reigniting fears of a broader energy shock.
European and Asian gas benchmarks jumped up to 50%, while Brent crude briefly spiked as much as 13%, reflecting growing risks to supply routes, including the Strait of Hormuz, which Iran has threatened to target. Washington said Iranās military capabilities have been largely neutralised and signalled it could escort tankers through Hormuz, as Israel expanded operations against Hezbollah in Lebanon and warned of further regional retaliation if attacks continue.
Precious metals sold off sharply as the oil-driven inflation shock pushed real yields and the $ higher, leading markets to reprice rate expectations toward fewer cuts or a high-for-longer scenario, overwhelming goldās safe-haven appeal. Gold fell ~4%, silver 6%, and platinum 9% on Tuesday, with profit-taking and forced selling amplifying the move after a strong pre-selloff rally.
The UK, France and Germany signalled readiness to support defensive measures and reinforce regional security in response to Iranian attacks, with France deploying an aircraft carrier to the Mediterranean and European allies moving military assets to Cyprus, while Brussels continues diplomatic engagement to reduce tensions.
In private credit markets, Blackstoneās flagship private credit fund (Bcred) saw $1.7bn of net redemptions, with withdrawals reaching 8% of assets, testing the resilience of semi-liquid private credit structures. The outflows, alongside sector writedowns and halted redemptions elsewhere, have heightened investor unease and pressured listed alternative managersā shares. Additionally, Apolloās CEO, Marc Rowan, warned that higher rates and tighter liquidity are likely to trigger a shakeout across private markets, exposing weaker capital structures and business models. The effective yield of BofAās US High Yield Index (listed bonds) stands at 6.7% (303bp spread).
