Swamp Notes The economic fallout of the Iran war
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Mar 13, 2026 
Sam Fleming, FT economics editor focused on macro and central banks, and Myles McCormick, FT U.S. economics correspondent expert in energy markets, discuss the Iran conflict’s economic shock. They cover why oil surged above $100 and LNG strains, how bond markets and central banks are reacting, which economies face the biggest exposure, and the political risks from rising fuel costs.
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Strait Of Hormuz Shutdown Sparked Oil Shock
- Iran's shutdown of the Strait of Hormuz removed a fifth of global oil flows and sent Brent above $100 a barrel.
- Myles McCormick explains the supply shock plus allied attempts to use reserves and other levers still left prices seriously elevated.
Natural Gas Shock Hits Europe And Asia Hardest
- The crisis hit LNG and natural gas markets unevenly, with Europe and Asia far more exposed than the US.
- Sam Fleming notes the US is relatively insulated as a net gas exporter while Europe faces surging LNG and power prices.
Inflation Risk Has Repriced Global Bond Markets
- Bond markets moved sharply because investors repriced the outlook for short-term rates amid a renewed inflationary shock.
- Sam Fleming points to expectations of ECB and BOE tightening and fewer Fed cut bets as drivers of yields rising.