Oil Surges Past $90 on Iran War Escalation; USD and Risk Assets Under Pressure

Crude oil prices rebounded sharply above $90 per barrel on March 11 as escalating US-Iran military tensions overshadowed the prospect of a Strategic Petroleum Reserve (SPR) release by the US government. The surge in energy prices weighed on equity markets, with stocks dropping broadly as traders repriced inflation expectations and risk premiums across asset classes. The rally in oil carries significant forex implications, as higher energy costs tend to benefit commodity-exporting currencies such as CAD and NOK while pressuring energy-importing economies' currencies, particularly JPY and EUR. The market largely dismissed SPR release headlines, suggesting traders view the geopolitical supply disruption risk as more impactful than potential government intervention. Rising oil prices also feed directly into inflation concerns, potentially complicating central bank rate paths globally. The EU has already flagged that the conflict could push eurozone inflation above 3%. For forex traders, the oil spike amplifies volatility across USD pairs and commodity-linked currencies, with USDCAD and USDJPY likely to see increased activity as geopolitical headlines dominate near-term sentiment.