Not Just Oil: Are the Risks of US-Iran War Seriously Underestimated? Strategists List Three Major "Stress Signals"

Ask AI · How does logistics pressure trigger hidden economic risks in the US-Iran war?

Cailian Press, March 20 (Editor: Huang Junzhi) A senior strategist recently warned that investors have completely misunderstood the market volatility caused by the US-Iran war.

Amova is one of the world’s largest asset management firms, managing approximately $260 billion in assets. Its Chief Global Strategist Naomi Fink stated in a client report that investors seem to have viewed the recent price swings (triggered by the Strait of Hormuz closing and oil prices) as a simple oil crisis.

However, she pointed out that beneath the surface of oil price fluctuations, other signs indicating more severe economic shocks are emerging.

“The most severe pressures currently faced are not from crude oil prices but from the logistics and transportation markets,” she wrote.

Fink highlighted three overlooked warning signals that could seriously disrupt the global supply chain:

First, the cancellation of insurance for ships passing through the Strait of Hormuz. Even if the U.S. Navy can open the strait, insurance companies may still be unwilling to insure ships passing through it.

Second, soaring transportation costs, which will suppress demand. Fink wrote: “LNG freight rates have surged from about $23,000 per day before the conflict to over $220,000 per day; these are the actual costs borne by shippers and end consumers, roughly a 1000% increase from before.”

Third, Fink noted that the number of ships passing through the strait daily has decreased from 130-240 to about 5, effectively cutting off supplies of any products (not just oil) that rely on this critical waterway to enter the global market.

Fink stated that adding all these factors together, even if oil prices fall, the impact on the global economy could be negligible.

She wrote, “Oil supply may indeed be available, but if it cannot be transported or insured, global supply chains will be disrupted. This shock is increasingly resembling a logistics-driven energy crisis, rather than just a simple supply shortfall.”

Fink said it’s difficult to predict how much these factors will affect economic growth. She noted that they could continue to influence inflation data, suppress consumption, and tighten financial conditions over several quarters, ultimately reflected in GDP figures.

She emphasized that, in this sense, the war is at a “critical juncture”—the longer shipping delays persist, the greater the hindrance to economic growth.

Other Wall Street institutions, including Bank of America and Citadel Securities, have also begun warning that as the US-Iran war continues, concerns about economic growth—rather than inflation—are increasingly becoming the risk to watch.

“Markets need to see international ships safely passing through the Strait of Hormuz as soon as possible, or financial conditions will need to shift focus from inflation to growth risks,” Citadel Securities strategist Frank Flight stated in a recent report.

(Cailian Press, Huang Junzhi)