24 March 2026 2 minute read
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The price of oil recently reached four-year highs. Will this be a short-lived shock or a long-term issue?

Figure 1: The Brent crude oil price was volatile in early March (dollars)

The Brent crude oil price was volatile in early March (dollars) chart

Past performance is not a reliable indicator of future returns.

Source: Bloomberg, Aviva Investors. Data as of March 13, 2026.

On March 8, 2026, the oil price jumped to over $100 per barrel of Brent crude, its highest level in four years (see Figure 1). It even neared $120, a level last seen in 2022, during the Russia-Ukraine conflict.1 That was another war‑driven supply shock that pushed inflation higher and ended up impacting returns for both equities and bonds over the year.

The backdrop today is different. In 2022, inflation was already high and rising when Russia invaded Ukraine. Before the Iran‑related escalation this year, inflation was close to central banks’ target levels and falling.

But the comparison still matters: if the oil price stays high, the risk is a mix of higher inflation and weaker growth (“stagflation”). That tends to be a difficult environment for most assets.

For now, it’s still very early. News is shifting by the hour, and markets are reacting just as quickly. What will matter most is how long the conflict lasts: will it be a short‑lived shock or a sustained drag on global growth? The coming weeks will be critical in determining which way it breaks.

References

  1. Jamie Smyth, Verity Ratcliffe, “Oil surges past $100 a barrel for first time in four years”, Financial Times, March 8, 2026.

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