UBS On-Air: Market Moves Top of the Morning: CIO Strategy Snapshot - US-Iran conflict: Assessing the market & macro impacts
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Mar 16, 2026 Jason Draho, Head of Asset Allocation Americas at UBS CIO, offers macro and asset allocation perspective. He discusses how the US-Iran conflict may affect oil prices and Fed timing. He covers potential GDP drag from higher energy, tax-refund dynamics that could boost growth, and portfolio moves like diversification, commodities and AI exposure.
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Higher Oil Prices Likely To Persist Short Term
- The US-Iran hostilities are unlikely to cause a sustained structural rise in energy prices, but disruptions mean oil will stay higher for longer.
- UBS CIO forecasts Brent at $90 by end-June (up from $65), easing to $80 by next March absent prolonged Strait of Hormuz closures.
Strategic Reserve Releases Push Prices Upward
- Strategic reserve releases and drawdowns create a lasting upward shift in oil prices even after shipping resumes.
- OECD agreed to release 400 million barrels, which raises near-term prices and lengthens the rebuild period.
Oil Shock Has Modest Drag On GDP
- A sustained $10 per barrel oil increase historically trims GDP growth by about 10 basis points.
- UBS estimates a $20 structural increase could shave 10–20 bps off growth, given the US's greater energy independence.