The expected rise in inflation is impacting mortgage interest rates, bond returns, and the balance sheets of central banks

Economic Effects of the Middle East Conflict

The ongoing turmoil in the Middle East has brought several important issues to the forefront. While the threat to oil and gas supplies is widely recognized, there are also less obvious repercussions, such as disruptions in fertilizer availability, which can drive up food costs.

According to the US Department of Energy, oil and gas are essential for producing over 160 different products, including components for renewable energy like solar panels and wind turbine blades. The interconnectedness of these industries can be surprising.

As the conflict enters its fourth week, one of the most immediate economic consequences is a rise in inflation. For example, the price of Brent Crude oil has increased, reflecting these broader impacts.