In a recent briefing, analysts pointed to early market response reflecting concentration risk. Commodities with the greatest Middle East exposure (notably oil and fertilizers) have shown almost immediate price reaction. Meanwhile, chemicals and certain metals are beginning to feel supply pressure.
The Biggest Disruption in Decades
BMO oil and gas analyst Randy Ollenberger noted the scale of the disruption, arguing that prices so far haven't fully reflected the magnitude of the supply risk.
Crude prices briefly surged toward $120 per barrel before retreating to the $90-100 range. To Ollenberger, the market reaction remains relatively muted given the scale. He compared the situation to earlier crises such as the Russian invasion of Ukraine, which drove oil prices higher despite a smaller direct supply impact.
"The reality is that this is the biggest event for the oil market that we've had in decades," Ollenberger said, adding that the market appears to be underestimating the consequences of ongoing disruptions.
Even if hostilities were to end quickly, he said the conflict has already altered oil market fundamentals. Expectations for global oversupply have disappeared as inventories tighten and logistical disruptions spread across the supply chain.
Implications for Agriculture
Fertilizer markets are also under pressure due to the Middle East's dominant role ...
