Why Investors Should Pay Attention to Oil Prices as War With Iran Rattles Markets

On the March 2 episode of The Morning Filter_, _David Sekeraand Susan Dziubinski discuss the market reaction to the US and Israel’s strikes on Iran and what investors need to watch as volatility and geopolitical risks are expected to continue. Here is an excerpt from the show.

Why Investors Should Pay Attention to Oil Prices as War With Iran Rattles Markets

Susan Dziubinski: The US and Israel launched an attack on Iran over the weekend. How are the markets reacting on Monday morning?

**David Sekera: **Good morning, Susan. Not too badly, all things considered. Right now, S&P 500 premarket is down a little bit over 1%. That takes it back down to the bottom of the trading range that the S&P 500 is traded at since last November. On the Treasury bond market, there looks like they’re actually flat to slightly lower this morning. Now, we did have a rally in longer-term Treasuries over the past week in the runup to this action. But the US Treasury, like the 10-year is still under 4% and there’s only been a few instances since last, actually, October of 2022 that we’ve seen it dip below 4%. Oil prices up quite a bit. Looks like WTI, West Texas Intermediate, up 5.5 to 72.5 a barrel. And I just say, this is kind of one of the reasons why we’ve continually recommended that we think investors should have oil exposure in their portfolios. I mean, overall, one, oil demand, as much as we’re trying to move away, is still not going away anytime soon. We still think it’s a good hedge against inflation, and, of course, in this instance, is working as a hedge against geopolitical risks.

It’s also one of the reasons why I’ve recommended gold for a number of years now. Gold is up $155 an ounce. It’s hitting new all-time highs at $5,500 an ounce. If you remember, we recommended Newmont Mining NEM back in January and April of 2024, Barrick Gold B in January and June of 2025. From the oil market perspective, our pick here is still going to be Devon DVN. We still like long duration US Treasuries. I’d steer clear of corporate bonds. I think credit spreads are still going to widen out even further from where they are now. So I’d still be very cautious in the corporate bond market. But we still think over the longer term, probably looking for lower yields in Treasuries. So that’s where I keep my fixed-income portion of my portfolio.

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How Oil Markets Reflect Real-Time Market Risks

**Dziubinski: **Dave, as the war is going to continue, what do you think investors should be watching?

**Sekera: **Specifically, in this instance, the fog of war, it’s always difficult, at best, to separate, what’s real versus what’s propaganda. And in an era of social media where anyone can post anything, especially with what we’re seeing going on with artificial intelligence and deepfakes, I think you really need to stick to watching what’s going on in the oil markets. In my opinion, I think that probably reflects the best insights as to the on the ground situation. I’d watch the spot prices for both WTI West Texas, as well as for Brent. And I think it’s a combination of watching not just the amount of change, but the velocity of change in prices there. Of course, rising oil prices indicates the situation to be getting worse, falling prices may indicate that the situation is getting better.

So the reason I’m watching oil prices specifically more than I’m watching the other markets is, really, that’s a big boy market. You’re really not getting retail investors. You’re not getting advisors playing in oil fund futures. This is where you have the largest of the global macro hedge funds playing. These guys can spend lots and lots of money hiring people to give them the most up-to-date, most recent information. You have the global energy giants, BP BP, Exxon XOM. They have people really everywhere in the world, watching those fields, watching the pipelines. You can immediately call in on their satellite phones and give up-to-date information to their trading desk. So they have the best real-time information out there, probably even better than most governments have. So in that case, I think you see the changes in the oil prices faster than where you’re going to see it anywhere else, certainly faster than you and I are going to hear it by the time it gets through the news media.

Subscribe to The Morning Filter on Apple Podcasts_, or wherever you get your podcasts, and keep up with the latest research from hosts Susan Dziubinski and David Sekera on Morningstar.com._

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			43m 37s
		 Mar 2, 2026

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