Oil Markets Are Still on Edge After Months of Conflict. Here's What the Recent Escalation Between Iran and Israel Could Mean for Investors in 2026.

Oil markets remain volatile following escalated missile exchanges between Iran and Israel. The Strait of Hormuz, through which one-fifth of global oil supply passes, faces disruption with prediction markets assigning a 66% likelihood it won't return to normal until January. WTI crude oil trades around $91.38 per barrel. While Trump seeks to de-escalate tensions and reach a nuclear agreement, elevated oil prices could persist, potentially driving inflation and prompting Federal Reserve interest rate hikes that could negatively impact markets.