The Game Behind the Surge in Oil Prices: Middle East Warfare Resumes, Global Economy Faces "Stagflation" Test

Following last week’s U.S. airstrike on Iran nuclear facilities-related targets, the situation in the Middle East has sharply escalated this week. Brent crude oil prices temporarily broke through $95 per barrel, reaching the highest level since October 2025, with a year-to-date increase of over 20%. This round of oil price surge not only directly reflects geopolitical risks but also drags the global economy into a shadow of "stagflation." This article will analyze the deep causes of this oil price spike, its transmission pathways, and its profound impact on global asset allocation.

Warfare Resumes: The "Oil Lifeline" of the Strait of Hormuz at a Tipping Point

The immediate trigger for this oil price surge is undoubtedly the rapid escalation of military confrontation between the U.S. and Iran.

Escalation of Attacks and Retaliation Threats
On March 28, U.S. forces conducted precise strikes on targets related to Iran’s nuclear facilities along the Persian Gulf, citing the reason to "prevent Iran from transferring missile technology to regional armed groups." In response, the Iranian Islamic Revolutionary Guard Corps immediately seized two oil tankers associated with Western countries near the Strait of Hormuz and announced large-scale naval military exercises. Iranian officials publicly warned that if the U.S. continues provocations, they will consider "closing the Strait of Hormuz."

The Strait of Hormuz is the world’s most critical oil transportation artery, with about 20 million barrels of crude oil passing through daily, accounting for roughly one-third of global seaborne oil trade. If this strait is blocked or becomes a conflict zone, the global oil supply chain would instantly collapse. This extreme expectation of "supply disruption" is directly reflected in oil prices— the volatility index of crude oil futures (OVX) surged over 40% in the past week, indicating the market is pricing in the worst-case scenario.

OPEC+ Dilemmas and Producer Alliances
Geopolitical conflicts have forced major oil-producing countries to "pick sides." While Gulf countries like Saudi Arabia and the UAE publicly call for restraint, they privately express deep concerns about the security of the Strait of Hormuz. Meanwhile, cracks have appeared within OPEC+. The ministerial meeting originally scheduled for early April was forced to be brought forward, with market expectations that the organization will continue its production cuts. However, against the backdrop of already significant oil price increases, OPEC+ faces a dilemma: increasing output might be seen as a concession to the West; maintaining cuts would further push up prices and exacerbate global inflation.

Transmission Chain of Oil Price Surge: From CPI to PCE Full Impact

Crude oil is not only energy but also the "blood" of modern industrial economies. The surge in oil prices is rapidly pushing up global inflation through complex transmission mechanisms.

Directly Raising Energy Costs
The most immediate impact is on the energy component of the CPI (Consumer Price Index). According to AAA data, the average gasoline retail price in the U.S. has risen from $3.20 per gallon at the start of the year to $3.90, with some areas exceeding $4.50. For American consumers, rising oil prices are akin to an "invisible tax," directly squeezing household disposable income for other goods and services.

Transmission to Core Inflation
More concerning is the infiltration of energy price increases into core inflation. Rising transportation costs lead to higher prices for food and daily necessities; increased jet fuel prices push up airline ticket costs. Goldman Sachs’ latest report states that every $10 increase in oil prices will raise the global core inflation rate by about 0.2 percentage points over the next year. Considering that oil prices have already risen nearly $20 since the start of the year, this suggests that the process of global inflation easing will be significantly delayed.

PCE Data Faces Upward Pressure
For the Federal Reserve, the surge in oil prices presents a thorny problem. The upcoming release of the core PCE inflation index was already expected to show strength, and the lagged transmission effect of oil prices has not been fully incorporated. Economists warn that if oil prices remain above $95, the PCE data over the next three to six months will continue to face upward pressure, further compressing the Fed’s room to cut interest rates this year, and in extreme cases, even prompting a rate hike.

The Ghost of Stagflation Reappears: A Dual Dilemma of Economic Downturn and Inflation Rise

If inflation is the "old ailment," then slowing economic growth is the "new disease." The surge in oil prices is pushing the global economy toward the most dangerous "stagflation" combination.

Europe Bears the Brunt
As a net energy importer, Europe’s economy is most sensitive to oil price fluctuations. March PMI data from major economies like Germany and France have already shown fatigue, with manufacturing continuing to contract. If oil prices continue to rise, Europe could face a "second energy crisis," with further restrictions on industrial production, rising living costs, and the European Central Bank having little room to maneuver between fighting inflation and supporting growth.

U.S. Economic Resilience Under Pressure
Although the U.S. economy’s direct dependence on energy has decreased, it cannot be immune. The University of Michigan consumer confidence index has fallen for three consecutive months, with inflation expectations rising to 4.1%, a new high since 2024. The risk of "anchoring inflation expectations" is precisely what the Fed most fears. Meanwhile, the Atlanta Fed’s GDPNow model has lowered the U.S. Q1 GDP growth forecast from 2.8% to 2.2%, indicating weakening economic momentum.

Input Pressures on Emerging Markets
For emerging markets heavily reliant on oil imports (such as India, Turkey, and some Southeast Asian countries), soaring oil prices directly lead to widening trade deficits and increased currency depreciation pressures. These countries will be forced to raise interest rates to defend their exchange rates, further suppressing domestic demand, and overall slowing the global economic recovery.

Asset Price Reconfiguration: Who is Celebrating, Who is Bleeding?

The surge in oil prices is rewriting the valuation logic of various assets.

Oil-Related Assets as Safe Havens
Undoubtedly, oil and related energy stocks have become the only "safe haven" in the current market. The S&P 500 energy sector has risen 18% this year, far outperforming other sectors. Giants like ExxonMobil and Chevron have hit record highs. Meanwhile, companies involved in oil exploration and oilfield services are also attracting capital.

Reevaluation of Bitcoin’s "Energy Attribute"
It’s noteworthy that this round of oil price increases has formed a subtle link with Bitcoin prices. While traditional logic suggests high oil prices = high inflation = tightening monetary policy = negative for risk assets, Bitcoin’s resilience near $65,000 recently is partly due to its "energy-intensive" nature being revalued. Against the backdrop of strained global energy supply chains and intensified sovereign conflicts, the physical energy costs of Bitcoin mining have become part of its valuation support. This is similar to the performance of gold during the 1970s oil crisis—when gold prices surged alongside oil prices as investors sought to hedge inflation and geopolitical risks simultaneously.

Traditional Risk Assets Under Pressure
Conversely, stock markets (especially tech stocks) and bond markets are experiencing painful revaluations. The Nasdaq has fallen about 5% since March, lagging behind the Dow, indicating high-growth stocks are most sensitive to rate expectations. The U.S. Treasury yield curve has steepened further, with the 10-year yield approaching 4.8%, reflecting market demands for higher inflation compensation and term premiums.

Outlook: Three Possible Paths for Oil Prices

Looking ahead, the trajectory of oil prices will depend on the game among three major variables: the intensity of geopolitical conflict, OPEC+ policy choices, and the true state of global demand.

Scenario 1: Escalation of Conflict (30%)
If the Strait of Hormuz is truly blocked or if direct military conflict erupts between the U.S. and Iran, Brent crude could quickly surge past $120 or higher. The world would plunge into severe stagflation, with the Fed forced to make extreme choices between recession and inflation, and risk assets facing systemic sell-offs.

Scenario 2: Controlled but Persistent Conflict (55%)
This is the current market’s mainstream expectation. Military conflict remains at proxy levels, the Strait of Hormuz is not fully blocked, but shipping insurance premiums stay high, and supply risk premiums remain elevated. Oil prices will fluctuate within the $90–$100 range, with the Fed delaying rate cuts until the end of the year, entering a prolonged "inflation + growth slowdown" phase.

Scenario 3: Successful Diplomatic Mediation (15%)
If the international community successfully facilitates indirect talks between the U.S. and Iran, and OPEC+ commits to increasing production to stabilize prices, oil could quickly fall below $80. This would open the window for the Fed to cut rates, and risk assets could rebound strongly. However, given the current tense rhetoric and mutual distrust, this scenario is the least likely.

Conclusion: Survival Rules in the Eye of the Storm

For investors, the core dilemma today is no longer a single "inflation" or "recession," but the intertwined "stagflation" predicament. As the "epicenter" of this storm, oil prices will dominate the valuation logic of global assets over the next six months.

In such an environment, traditional "stock-bond balance" strategies are failing—stocks and bonds may decline simultaneously. Investors need to reassess the resilience of their asset portfolios: moderately allocate to energy-related assets to hedge against oil price risks, increase cash reserves to cope with volatility, and seek structural opportunities in non-sovereign assets like Bitcoin.

Behind the surge in oil prices lies a complex game of geopolitics, energy security, and monetary policy. When the waves of the Strait of Hormuz are turbulent, and inflation figures rise again, staying alert, reducing leverage, and embracing certainty may be the only way to navigate through this storm. #國際油價走高