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The ongoing war in Iran and the subsequent closure of the Strait of Hormuz continues to rattle the global economy.
As of March 31, the S&P 500 has lost roughly 5.7% year to date (1), while U.S. inflation expectations for 2026 have surged to 4.2%, up from 2.6% in 2025, according to a forecast by the Organization for Economic Cooperation and Development (2). However, entrepreneur Kevin O’Leary struck a contrarian tone in a recent interview on Fox Business.
“To affect the U.S. economy, you need oil — I’m talking about recession talk, or hurting the economy or damaging small business — you need oil at above $93 for three months,” said the Shark Tank host (3). “We’re only one third into it, so everybody chillax and let this thing play out.”
If the conflict can be resolved quickly, O’Leary suggested it could create “huge” opportunities for everyone, including America’s allies in Asia and the Middle East. “It’s history being made,” he said.
Unfortunately, industry experts and representatives of America’s allies in the Middle East paint a very different picture. Here’s why ordinary Americans should get prepared instead of taking O’Leary’s advice to just “chillax.”
Oil prices are notoriously volatile and difficult to predict. However, a wide range of experts seem to agree on one potential outcome: higher prices for a longer period of time.
That’s likely due to the fact that Iran has not only closed the Strait of Hormuz, it’s also damaged dozens of refineries, oil fields, gas plants and ports with drones and missiles, as Bloomberg reports (4).
This infrastructure damage, according to HedgeEye Risk Management Energy Analyst Fernando Valle, “can’t be easily reversed.”
“It’s going to be a long-lasting effect even if the war stops tomorrow,” Valle said in a Yahoo Finance interview on March 17 (5). “It’s not as easy as flipping a switch to produce oil again.”
The head of the International Energy Agency, Fatih Birol, echoed these concerns in late March in an interview with CNBC (6). As many as 40 energy assets across nine countries have been “severely or very severely” damaged, he said, and the resulting oil shock could be as big as both of the major oil crises of the 1970s, plus the 2022 gas crisis “put together.”
The view that the conflict will be resolved quickly and the global economy will go back to normal is “overly optimistic,” European Central Bank President Christine Lagarde told The Economist (7).
“Maybe they are overly optimistic, and determined to stay optimistic, in the hope that a positive scenario will materialize and we will be back to normal in a relatively short time. Which is not what the technical experts are telling us in terms of capacity, extraction, refinery, distribution, because too much has already been damaged and there’s no way that it can be restored in a matter of months,” Lagarde said. “Most people are actually talking about years.”
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Senior officials from Saudi Arabia also told the Wall Street Journal that crude oil prices could surge to $180 a barrel if the conflict continues past April (8), adding that this elevated price could trigger a global recession.
Making matters worse, the war in Iran seems to be escalating instead of heading for a quick resolution. Houthi rebels reportedly joined the battle on March 28, which could threaten the Bab el-Mandeb strait on the Red Sea, another chokepoint for Middle Eastern energy (9).
Meanwhile, the New York Times reports the U.S. has assembled more than 50,000 troops in the region, potentially setting the stage for a ground invasion (10).
In this environment, neither panic nor complacency are good investment strategies. Instead, you should move to protect your finances and consider some exposure to energy stocks and ETFs.
Gold is typically considered a safe haven for investors looking to avoid inflation and global crises, and you can combine the inflation-protection features of this precious metal with the tax advantages of an IRA with Priority Gold.
The platform’s Gold IRAs allow investors to hold physical gold or gold-related assets within a retirement account. To learn more, you can get a free information guide that includes details on how to get up to $10,000 in free silver on qualifying purchases.
Alternatively, you could consider exposure to the oil and gas giants that could potentially benefit from a prolonged energy shortage. If you’re unfamiliar with the industry, you can follow experienced investors on Public, a self-directed investing platform that charges no commission on stock and ETF trades.
The platform’s social features allow you to learn from the best investors in any sector before you invest your own money. And, as an added bonus, Public also offers a no-fee account with a 3.30% APY. That’s close to the same as the Organization for Economic Cooperation and Development’s inflation forecast for this year, which means you can largely preserve purchasing power even before you start trading on Public.
While much of the world hopes for a quick resolution to the war in Iran, preparing yourself for the worst-case scenario is prudent in these tough economic times.
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Seeking Alpha/X (1); Organization for Economic Cooperation and Development (2); Fox Business (3); Bloomberg (4); Yahoo Finance/X (5); CNBC (6); The Economist/YouTube (7); The Wall Street Journal (8); The Associated Press (9); The New York Times (10).
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
