What If You Invested in Oil Stocks Before Every Major Middle East Conflict?
Brent crude just hit $112.57 a barrel - the highest since Russia invaded Ukraine in 2022. The Strait of Hormuz has been effectively closed to commercial traffic since March 2, disrupting roughly 17.8 million barrels per day of oil flows.
This isn't the first time a Middle East conflict has sent oil prices soaring. It's happened over and over for the past 35 years.
The Pattern: Conflict Hits, Oil Spikes, Stocks Follow
| Conflict | Date | Oil Before | Peak | Change |
|---|---|---|---|---|
| Gulf War | Aug 1990 | $17 | $46 | +170% |
| Iraq War | Mar 2003 | $30 | $40 | +33% |
| Saudi Aramco Strike | Sep 2019 | $60 | $69 | +15% |
| U.S.-Iran War | Feb 2026 | $75 | $112+ | +50%+ |
The 1990 Gulf War produced the most dramatic oil shock. When Iraq invaded Kuwait, crude went from $17 to $28 in four days. By mid-October it had hit $46 - a 170% increase. But once Operation Desert Storm launched in January 1991, the spot price collapsed back to $20 within weeks.
2026: The Iran War
The Strait of Hormuz closure is a genuine supply disruption, not just a fear premium. Goldman Sachs estimates the conflict has added a $14-18 per barrel risk premium to crude. Their extreme scenario: $135 if the market prices in a six-month disruption.
| Stock | 2026 YTD | Note |
|---|---|---|
| ExxonMobil (XOM) | ~+30% | All-time high |
| Chevron (CVX) | ~+30% | All-time high |
| ConocoPhillips (COP) | ~+30% | All-time high |
| S&P 500 | ~-2% | Down on uncertainty |
What History Tells Us
The initial spike is almost always bigger than the lasting impact. Oil jumped 170% during the Gulf War but was back to $20 within months. The 2019 Aramco attack caused a 15% one-day spike that reversed in two weeks.
The exceptions are when supply disruptions last longer than expected. If the Strait of Hormuz stays closed through Q2, this conflict could look more like 2003 - a slow grind higher rather than a spike-and-reverse.
The best returns came from buying during the conflict and holding for years, not trading the spike.
The Bottom Line
Every major Middle East conflict since 1990 has been followed by oil stock outperformance. The 2026 Iran war is following the same playbook: oil prices up 50%+, major energy stocks at all-time highs, and the S&P 500 in the red.
Try the calculator to see what your investment in ExxonMobil, Chevron, or ConocoPhillips would be worth today. Or browse all energy stocks.
Related: Defense stocks and the Iran conflict