MPC Morning Call 13 March 2026 – Oil Breaches $100 as Trump underestimates the length of Iran Conflict
Global markets endured a brutal session overnight as the Iran war entered its 13th day with no signs of de-escalation. Brent crude surged above $100 a barrel for the first time since 2022 after Iran’s new supreme leader vowed to keep the Strait of Hormuz closed, while the IEA…
WATCH ON YOUTUBE S&P 500 Daily Heatmap – March 12, 2026 Major Indices – Daily & 5-Day Net Change MPC Morning Call 13 March 2026 – Oil Breaches $100 as Trump underestimates the length of Iran Conflict Global markets endured a brutal session overnight as the Iran war entered its 13th day with no signs of de-escalation. Brent crude surged above $100 a barrel for the first time since 2022 after Iran’s new supreme leader vowed to keep the Strait of Hormuz closed, while the IEA warned the conflict has caused the largest oil supply disruption in history. The S&P 500 fell 1.5%, bond yields spiked as traders fully unwound 2026 Fed rate cut bets, and the US dollar hit a two-month high. Private credit stress added to the risk-off mood, with Morgan Stanley capping redemptions and JPMorgan marking down loan portfolios. Iran War Escalation Sends Oil Above $100 Brent crude surged 9.2% to close above $100 a barrel – its highest since August 2022 – after Iran’s newly appointed supreme leader Mojtaba Khamenei declared the Strait of Hormuz would remain closed. The IEA confirmed the conflict has now caused the largest oil supply disruption in the history of the oil market, hitting 7.5% of global output. Three commercial vessels were struck in the Arabian Gulf overnight, while UK Defence Secretary John Healey said Iran had likely begun laying mines in the strait. The Trump administration responded by flagging a potential waiver of the Jones Act to ease domestic fuel transport, and Energy Secretary Chris Wright indicated the US Navy could begin escorting tankers through Hormuz by month’s end. Goldman Sachs warned prices could exceed the 2008 peak of $147.50 if flows remain depressed. US gasoline prices have climbed to $3.60 per gallon, their highest since May 2024. Wall Street Selloff Deepens Amid Private Credit Stress All three major US indices fell sharply, with the Dow down 1.6%, the S&P 500 off 1.5%, and the Nasdaq shedding 1.8%. The S&P 500 recorded its biggest three-day percentage drop in a month and is now down 2.5% year-to-date. Only energy stocks posted gains as the war-driven oil rally lifted producers. Adding to the risk-off tone, cracks in the $1.8 trillion private credit market widened: Morgan Stanley capped redemptions at one of its private credit funds, JPMorgan marked down loan portfolios held by private credit groups, and Deutsche Bank flagged a $30 billion exposure. Partners Group warned default rates in private credit could double in coming years. In late trading, Adobe fell 7.2% after its CEO of 18 years announced his resignation, despite beating quarterly estimates. Bond Rout Accelerates as 2026 Fed Rate Cut Bets Evaporate The global bond selloff intensified as markets repriced the inflation outlook. Traders have now fully unwound expectations for even a single Fed rate cut in 2026, a dramatic reversal from just weeks ago when three cuts were anticipated. The US 2-year yield jumped 11 basis points to its highest since August, while UK gilt yields posted their biggest two-day rise since February 2024 and Germany’s 10-year Bund yield hit its highest since October 2023. President Trump publicly pressured Fed Chair Jerome Powell to cut rates immediately. The Fed meets next week and is widely expected to hold, but its updated economic projections will be closely watched. Friday’s US PCE inflation data – the Fed’s preferred gauge – will be critical, with analysts warning a hot print could further stoke fears of an energy-driven inflation shock. Next week also brings rate decisions from the RBA, BOJ, ECB, BOE and several others, making it one of the busiest central bank weeks of the year. Commodities, Energy & FX Commodities, Energy & FX – 24h & 5-Day Net Change ASX Today: Bracing for a Rough Open The ASX 200 fell 1.3% in Thursday’s session and is down 3.5% over five days, with technical indicators flashing strong sell across all timeframes. Overnight moves suggest further pressure at Friday’s open. Energy stocks may benefit from the crude surge, but the broader selloff in financials, industrials, and consumer discretionary sectors on Wall Street is likely to weigh heavily. Australian dollar weakness (down 1% overnight, the worst performer among G10 currencies) adds another layer of caution. The RBA rate decision next week looms large, with more economists now expecting a potential hike given the inflationary impulse from oil. Day Ahead: Key Economic & Corporate Events All eyes will be on Middle East developments and energy market moves heading into Friday. Key data releases include: US PCE inflation (January, the Fed’s preferred measure), US durable goods orders (January), US JOLTS job openings (January), US Q4 GDP second estimate, University of Michigan inflation expectations (March preliminary), Canada unemployment (February), Euro zone industrial production (January), UK trade and industrial production (January), and Germany wholesale inflation (February). Central bank…
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