The World Transformed After One Month of War: Who is Laughing and Who is Crying?

The geopolitical tensions stemming from the escalation of conflict in the Middle East have now entered their first month, bringing significant impacts to the stability of global financial markets.

Following the outbreak of war on 28 February 2026 and since early March 2026, market participants have responded to the high level of uncertainty regarding the smooth operation of international logistics supply chains, particularly in the energy sector.

This macroeconomic condition has triggered a fairly massive shift in capital flows from risky assets in developing countries to instruments deemed to offer higher levels of security.

This situation is heavily influenced by market projections that disruptions to strategic trade routes in the Middle East will skyrocket industrial operational costs and once again trigger global inflation pressures.

As a result, risk-off sentiment has pressured currency exchange rates and stock market indices in the Asian region, while energy commodity instruments have recorded value surges. Below is a review of the performance of various asset classes over the past month.

Escalation of Global Crude Oil Prices

The global energy market has become the sector most responsive to the current geopolitical uncertainty. The movement in global crude oil prices has recorded a highly aggressive and persistent upward trend throughout March 2026.

Based on trading data, the price of the global Brent benchmark oil, which was still around US$72.48 per barrel at the beginning of the month, experienced a sharp surge to reach US$116.6 per barrel by the end of the month.

The same linear pattern was also recorded for West Texas Intermediate (WTI) oil, which rose significantly from US$67.02 per barrel to US$102.88 per barrel.

This price surge reflects the high risk premium applied by the market to anticipate the worst-case scenario of halted energy production and distribution activities through the Strait of Hormuz, which accounts for 20% of the world’s reserves.

Surge in Coal Commodity Prices

Concerns regarding the availability of fossil energy quickly spread to the substitute commodity market, one of which is coal. The global coal price movement graph shows a consistent strengthening trend, albeit accompanied by fairly high daily volatility.

At the beginning of March 2026, coal prices were at US$116.9 per tonne. As time passed and the conflict escalation showed no signs of abating, the price of this commodity continued to rise and closed at US$148.6 per tonne on Monday (30/3/2026).

This rise in coal prices indicates that many industrial countries are beginning to secure their primary energy supplies as an alternative and mitigation step due to excessively high oil prices or disrupted supplies.

Positive Trend in Palm Oil Prices

In the agricultural commodity sector, the price of crude palm oil (CPO) showed solid gradual strengthening throughout the month.

Based on its historical price movements, CPO prices rose from 4,042 MYR per tonne and climbed consistently to a high of 4,631 MYR per tonne.

This increase in CPO prices has a close correlation with the soaring global crude oil prices. Demand for vegetable oil as an alternative raw material for biodiesel products tends to experience proportional increases when fossil energy prices skyrocket in the market.

Depreciation of Precious Metal Prices

In heated geopolitical conditions, precious metal instruments like gold typically serve as hedging assets or safe havens. However, market dynamics over the past month show an anomaly where gold prices have instead faced heavy selling pressure.

Global gold prices were recorded to experience a downward trend from US$5,277.29 per troy ounce on 1 March 2026, reversing direction and shrinking to US$4,492.48 per troy ounce by the end of the month.

This depreciation of gold’s value is heavily influenced by the shift in market liquidity, which prefers US dollar-denominated debt instruments offering far more attractive real yields, even in oversold conditions.

Gold’s fate was dismal in March. Gold prices fell more than 14.6% throughout March, the worst record since October 2008 when prices plummeted 16.9%.

Continuous Decline in Silver Prices

In line with the negative performance of the main precious metal, silver commodities also recorded no less sharp value shrinkage. Global silver price movements corrected continuously throughout March.

From an initial position of US$93.82 per troy ounce, silver prices continued to slide down, passing several support levels, to finally stand at US$68.43 per troy ounce at the end of the period.

This decline reinforces the view that current investment appetite is not favouring asset instruments that do not provide returns in the form of interest or dividends, especially when benchmark interest rates are projected to remain high due to potential upcoming inflation.

Rise in US Treasury Yields

The global liquidity shift is clearly recorded in the US government bond market. The yield on the 10-year US Treasury showed a continuously upward graph without significant corrections throughout the month.

Starting at 3.96% at the beginning of the month, the yield level continued to rise to breach 4.44%. This increase in yields reflects investment managers’ expectations that the US Federal Reserve will maintain tight monetary policy for a longer period due to the return of inflation risks from the logistics and energy sectors.

Pressure on Asian Exchange Rates

As a mechanical impact of the strengthening US dollar and portfolio shifts to risk-free assets, the foreign exchange market in the Asian region has been uniformly pressured.