Former NATO commander James Stavridis has warned that Iran could resort to large-scale retaliation in response to perceived existential threats from U.S. military actions. According to Stavridis, the Iranian regime may feel backed into a corner, potentially triggering extreme measures to ensure its survival. Key retaliatory options include the closure of the Strait of Hormuz, a critical artery for global oil transit, which would severely disrupt energy markets. The warning also highlights the risk of Iranian attacks against American assets both within the Middle East and globally. These geopolitical risks are creating significant upside pressure on Brent Crude and WTI prices while boosting the appeal of safe-haven assets like XAU/USD. Market analysts suggest that such an escalation could weigh heavily on equity benchmarks like the SPY as recessionary fears and supply chain concerns intensify.
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