The Iran-Israel War has erupted into open conflict, igniting dramatic shifts across global financial markets. On February 28, 2026, the United States and Israel launched coordinated airstrikes—codenamed **Operation Epic Fury by the U.S. and Roaring Lion by Israel—targeting Iranian military installations, nuclear-related sites, government facilities, and key leadership across cities including Tehran, Isfahan, Qom, Karaj, and Kermanshah. President Donald Trump confirmed the strikes, announcing the death of Iran's Supreme Leader Ayatollah Ali Khamenei and vowing that "heavy and pinpoint bombing" would continue "uninterrupted throughout the week or as long as necessary" to neutralize threats and promote regional peace.
Iran responded swiftly with missile and drone barrages aimed at Israel, as well as U.S. military bases in Qatar, Bahrain, Jordan, Kuwait, Saudi Arabia, and the UAE. Reports indicate civilian casualties, including an Israeli strike on a school in southern Iran killing over 60 students, heightening international alarm. The operation marks the second major U.S.-Israeli action against Iran in under a year, following exchanges in June 2025, but this escalation appears far broader in scope and ambition, raising fears of prolonged war, regime instability in Tehran, and disruptions to global energy flows.
Markets reacted immediately with classic risk-off behavior. Gold , the ultimate safe-haven asset, surged dramatically past $5,300 per ounce. Spot prices climbed toward $5,323 in after-hours and crypto-linked perpetual futures trading, while March 2026 futures hit $5,280 amid intense institutional buying. Analysts attribute the rally to geopolitical uncertainty, potential inflation from energy shocks, and central bank demand—JP Morgan recently raised its 2026 year-end forecast to $6,300, with long-term targets at $4,500–$6,300. Precious metals like silver also gained, reflecting broader flight to safety.
Oil prices spiked as traders priced in risks to Iranian supply (around 3.3 million barrels per day) and potential closure or harassment of the Strait of Hormuz, through which roughly 20% of global oil passes. Brent crude rose toward $70–$73 in early reactions, with perpetual swaps on platforms like Hyperliquid jumping 5% to $70.60. Experts warn that sustained conflict could propel prices toward or beyond $100 per barrel, fueling worldwide inflation, squeezing consumer spending, and pressuring central banks already grappling with high rates.
In stark contrast, Bitcoin —often viewed as a risk-on, high-volatility asset—crashed below $64,000, dropping as much as 5–6% to around $63,000 before partial recovery attempts. The broader cryptocurrency market shed billions rapidly, with liquidations cascading through leveraged positions. Unlike gold, Bitcoin failed to act as a hedge in this crisis, instead mirroring equities' sell-off as investors dumped speculative holdings. Some crypto venues offered 24/7 oil and gold trading as alternatives, underscoring Bitcoin's sensitivity to geopolitical shocks and its correlation with risk assets during uncertainty.
Equities faced immediate pressure, with Asian shares declining and volatility indexes like the VIX climbing sharply. The U.S. dollar strengthened modestly as a safe haven, while bond yields showed mixed moves amid inflation fears. Few allies joined the U.S.-Israel operation militarily, amplifying perceptions of isolated risk. Analysts caution that the next 24–48 hours—and any further Iranian retaliation or Strait disruptions—will dictate whether this becomes a short, contained spike or a multi-week energy crisis with deeper economic fallout.
