Iran war: scenarios, conflict pathways and market implications
This report provides scenario mapping of the ongoing U.S.-Israel-Iran war, analysing potential regional escalation pathways, Strait of Hormuz disruption risk and the likelihood of further attacks on Gulf energy infrastructure.
The following analysis draws on source inquiries and ongoing research conducted by our team across the region, and forms part of our broader monitoring of the Iran–Israel–U.S. conflict and its implications for global markets.
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Scenario outlook
Base case
Chronic instability
40%
- Oil $80–120; persistent premium
- Defense & maritime outperform
- CB rate cuts delayed
- GCC at discount; no capital flight
Worst case
Stagflation shock
35%
- Oil $110–180; supply shock
- Gulf energy offline
- Credit spreads widen sharply
- GCC SWF forced deleveraging
Best case
Negotiated deal
25%
- Oil falls to $60–90
- Risk-on rally; rate cuts repriced
- GCC recovery slow to 2027
- Qatari gas contracts repriced
Oil price trajectory by scenario
Best (25%)
Base (40%)
Worst (35%)
Range band
Midpoint lines show central trajectory within each scenario range. Shaded bands show full price range per the report. Source: GIG Special Brief, 26 March 2026.
Executive Summary
- Markets must now price instability continuously, not periodically. The Iran conflict has shifted from an episodic risk to a structural baseline.
- The report examines three distinct pathways:
- Base case (40%): chronic instability without systemic breakdown
- Worst case (35%): uncontrolled escalation and stagflationary global shock
- Best case (25%): partial political reset and negotiated de-escalation
