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Investors prosper while consumers pay as Iran war delivers uneven economic toll
🇸🇦 Saudi Arabia /Economy & Trade

Investors prosper while consumers pay as Iran war delivers uneven economic toll

From Asharq Al-Awsat · () English

Translated from English and summarized by DistantNews. Read the original for the full story.

At a glance

Analysis Named sources Context piece
  • Six months after the United States and Israel began bombing Iran, the global economy has avoided the worst forecasts of recession and economic catastrophe, although the conflict has affected economies worldwide.
  • Stock markets recovered sharply after an initial selloff, with the Dow, S&P 500 and Nasdaq rising nearly 19%, 22% and 27% from their late-March lows.
  • Higher oil prices have increased costs for travelers, while airlines have raised fares and fees, reduced flights and cut planned routes.

Six months into the war involving Iran, financial markets have recovered from their initial panic, while people who travel are still paying more for fuel and tickets.

The United States and Israel began bombing Iran on Feb. 28, prompting predictions of surging oil prices, a global recession and economic catastrophe. Oil prices did jump, and markets fell sharply. The Dow and Nasdaq entered corrections, while the S&P 500 recorded its worst month since 2022.

The reversal began after markets reached a low in late March. The Dow has since gained nearly 19%, the S&P 500 almost 22% and the Nasdaq 27%. If those gains hold through the remaining months of 2026, all three indexes would record four straight years of increases.

So far, the global economy has pulled off the financial equivalent of a ‘Mission Impossible’ scene.

— Michael Ashley SchulmanThe Cerity Partners investment strategist assessed the economy’s resilience six months into the war.

Michael Ashley Schulman, an investment strategist at Cerity Partners, said the global economy had so far pulled off the financial equivalent of a “Mission Impossible” scene. The International Monetary Fund said in a July report that two major forces were shaping the economy in opposite directions: the war was weighing on growth, while enthusiasm about artificial intelligence was offsetting that drag.

The effects have been less favorable for consumers. Movement through the Strait of Hormuz slowed sharply, pushing Brent crude from about $72 a barrel before the war to nearly $120 at its peak. Prices have eased but remain about 20% above prewar levels. The International Air Transport Association expects jet fuel to average 70% more than in 2025.

Airlines have responded by raising ticket prices, increasing baggage fees and adding fuel surcharges. They have also reduced flights or abandoned planned routes. Lufthansa Group cut 20,000 short-haul flights, while Spirit Airlines disappeared after years of financial trouble. Columbia University economist Brett House said fuel surcharges and airfares were unlikely to fall much in the next few months, leaving consumers with fewer choices and less airline competition.

The likelihood that fuel surcharges are going to be rolled back and airfares are going to be brought down is very low over the next few months.

— Brett HouseThe Columbia University economist described the outlook for air travel costs.
About this summary

Originally published by Asharq Al-Awsat in English. Translated, summarized, and contextualized automatically by DistantNews, with a note on how the source frames the story. Not individually reviewed before publishing. How this works.

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