Markets reprice risk as Iran war moves from disruption to enduring energy threat

Markets have shifted from viewing the Iran war as a short-lived disruption to pricing in longer-term energy and growth risks, with oil spiking and Fed rate-cut expectations shrinking as traders weigh inflation and the possibility of a prolonged conflict around the Strait of Hormuz; while there are brief signals of de-escalation, the market remains wary of extended escalation or a potential ground war, prompting a rethink of growth, inflation, and energy prices.