Marketplace All-in-One Escalation and investor anxieties
Mar 19, 2026
Jiajie Xu, assistant finance professor at the University of Iowa who studies trade shocks, and Russ Mould, investment director at AJ Bell and market commentator, discuss energy price moves after attacks on Gulf gas and oil sites. They analyze why Europe’s gas market is exposed, how markets reacted across assets, and how China’s WTO entry reshaped local U.S. banks and credit conditions.
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Europe's Gas Market Became Vulnerable To Gulf Attacks
- Global energy markets flipped to fear as Iran's retaliation and attacks on Qatari LNG pushed European gas up ~25% in a session.
- Europe had shifted from Russian supplies to Qatari LNG, making it highly exposed to attacks on Gulf infrastructure.
Diversification Fails When Geopolitical Fear Peaks
- In extreme geopolitical shocks assets correlate tightly and diversification can fail as investors sell whatever they can.
- Russ Mould observed equities, precious metals, industrial metals down and government bond yields up during the panic.
Geopolitics Muddy Fed Rate Outlook
- The Fed faces uncertainty from the conflict because higher global hydrocarbon prices could raise inflation, altering its path on rates.
- Markets trimmed chances of multiple cuts; CME pricing shifted from two cuts to roughly a 40% chance of one this year.