Markets on Edge as Middle East Tensions Mount; Oil Prices Extend Gains

Font: Financial Modeling Prep  • Jun 18, 2025

Global markets remained tense on Wednesday, with investors wary of deeper U.S. military involvement in the ongoing Israel–Iran conflict, now in its sixth day. Oil prices continued to climb, and appetite for risk assets remained subdued.

Escalation Risks Keep Markets Cautious

President Donald Trump’s call for Iran’s unconditional surrender and pointed warnings about fading U.S. patience have added fuel to geopolitical concerns. Markets are increasingly factoring in the possibility of direct U.S. intervention, with sentiment clearly turning risk-averse.

“Clearly the Middle East issues have not been solved... comments by President Trump just mean that things could get more dangerous,” said Joseph Capurso of CBA.

Oil Surges on Supply Worries

• Brent crude rose 0.3% to $76.67/barrel

• WTI crude climbed 0.43% to $75.16/barrel

Both benchmarks had surged over 4% on Tuesday as conflict risk premiums expanded.

For real-time insights into commodity trends, including oil and energy, check the Commodities API.

Global Equities Pull Back

The cautious mood spread across global equity markets:

• MSCI Asia-Pacific ex-Japan dropped 0.3%

• EUROSTOXX 50 futures slipped 0.34%

Risk-off sentiment was evident as traders dialed down exposure ahead of the U.S. Fed policy decision and macro data releases later this week.

Monitor global economic shifts using the Economic Calendar API.

Bottom Line

Markets remain hostage to geopolitical developments, with oil prices acting as a key barometer of sentiment. As the situation in the Middle East evolves, investors will remain defensive, seeking clarity on both geopolitical and monetary policy fronts.