Core Viewpoint - The ongoing military conflict involving the U.S. and Israel against Iran has escalated, with significant implications for global oil prices and market dynamics, particularly in the context of the Strait of Hormuz and energy supply disruptions [1][5][10]. Group 1: Military Conflict and Market Impact - President Trump's recent statements indicate a commitment to continue military actions against Iran until all objectives are met, suggesting a prolonged conflict [1]. - Goldman Sachs warns that the duration of the conflict has become a critical variable influencing oil, gold, and U.S. stock market trends, replacing the initial outbreak of hostilities as the primary concern [5][10]. - The potential for a significant increase in oil prices (10%-15%) is anticipated if markets reopen, with Brent crude possibly exceeding $80 per barrel [3]. Group 2: Strait of Hormuz and Oil Supply - The Strait of Hormuz, a vital passage for approximately 20% of global oil transport, has not been physically closed, but shipping volumes have significantly decreased due to market fears and self-imposed pauses [2][4]. - Current shipping disruptions are attributed to insurance companies withdrawing coverage and industry pauses in response to U.S. Navy requests, rather than direct actions from Iran or military strikes on oil infrastructure [2][4]. Group 3: Economic and Inflation Concerns - Goldman Sachs highlights the risk of a return to the "2022 energy shock scenario," which could lead to persistent inflationary pressures and complicate monetary policy for central banks [6][9]. - The current macroeconomic environment shows structural changes in inflation dynamics, with high fiscal spending and AI investment contributing to elevated inflation expectations [7][8]. Group 4: Asset Class Implications - For commodities, Goldman Sachs suggests that if commodity price increases become sustainable, the market will shift from a simple risk-hedging approach to a more complex interplay of inflation, growth, and distribution factors [12][13]. - In the equity market, the outlook is predominantly negative, with significant impacts expected only from severe and prolonged oil supply disruptions [14]. - The foreign exchange market may favor the U.S. dollar and Japanese yen as preferred safe-haven assets amid rising oil prices and supply shocks [16].