2022 parallels: Iran oil shock ’likely shorter but more globally disruptive’

Investing.com -- The Middle East conflict and escalating rhetoric around the Strait of Hormuz have pushed Brent crude above $100, raising the risk of a broader supply shock that BCA Research says could echo, but surpass, the turbulence of 2022.

BCA Chief Strategist Jeremie Peloso wrote in a note to clients on Monday that “parallels with 2022 offer a roadmap,” but today’s disruption is “likely shorter but more globally disruptive.”

Peloso stated that “war momentum and escalating rhetoric” have left investors confronting a single critical question as to how long the Strait will remain effectively shut, and whether global reserves “can outlast Iran’s determination to inflict economic pain on the U.S.”

“Once unleashed, war acquires a life of its own. Investors are increasingly coming to terms with that reality, regardless of what President Trump may say on social media in an effort to de-escalate,” wrote Peloso.

In his first address as Iran’s new Supreme Leader, Mojtaba Khamenei declared that the Strait would remain blocked and vowed retaliation for Iranians killed by the United States and Israel, while warning regional neighbours to shutter U.S. bases or face continued targeting.

Peloso wrote that Khamenei is “long known as a hardliner,” giving little reason to expect a conciliatory shift.

“Meanwhile, in his first press conference since the war began on February 28, Israeli Prime Minister Benjamin Netanyahu threatened Khamenei directly, underscoring the risk of further escalation,” BCA added.

Beyond oil, Peloso cautioned that disruptions to sulfur, helium and fertiliser “threaten food prices and the AI supply chain.”

With markets repricing tightening risks, BCA Research reiterated that rate hikes “are a mistake absent second-round inflation,” and advised investors to “position defensively.”

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