Published on: 2026-04-08
At the onset of the Iran conflict on 28 February, initial market reactions were predictable: oil prices surged, gold appreciated, the dollar strengthened, and traders reduced risk exposure. On the first full trading day following the strikes, U.S. crude rose 6.28% to $71.23, Brent rose 6.68% to $77.74, gold advanced by over 1%, and Bitcoin climbed 5.58%. These movements suggested the market was adhering to a familiar wartime pattern.
Subsequent market developments were less predictable. Bitcoin demonstrated resilience, contrary to expectations that it would underperform amid surging oil prices and renewed inflation concerns. While oil was the clear outperformer, Bitcoin emerged as a notably resilient asset. By 18 March, Bitcoin had risen since the onset of the conflict to $73,949, despite remaining approximately 15% lower for the year.
The point is not that Bitcoin suddenly became a conventional safe haven, or that it beat oil in an energy-driven conflict. The more useful observation is that, in a market shock that favoured energy and hurt most other assets, Bitcoin held up better than many expected, while traditionally steadier assets came under real pressure.
This article looks at how markets moved in the first three weeks after 28 February, using a set comparison period from 27 February to 20 March.
To keep the comparison clean, this article uses a single fixed window: the last pre-war close on 27 February 2026 and the 20 March 2026 close or settlement.
Brent crude: +54.8%
From $72.48 to $112.19.
Bitcoin: +7.0%
From $65,881.80 to $70,522.59.
S&P 500: -5.4%
From 6,878.88 to 6,506.48.
Gold: -10.4%
From $5,183.80 to $4,643.02 an ounce.
This scorecard makes it easy to see what happened. Oil clearly performed best. Bitcoin did not outperform oil, but it held up better than both gold and the main U.S. stock index during this period.
The outcome for oil is unambiguous. It was the primary beneficiary of the conflict. According to Reuters (13 March), Brent crude surged approximately 40% in the first two weeks following the U.S.-Israel strikes, approaching $120 per barrel. On 20 March, Brent settled at $112.19, marking its highest level since July 2022. Despite some late-March declines, oil remained the most direct indicator of the conflict's impact.
This outcome is unsurprising given that approximately one-fifth of global oil and liquefied natural gas (LNG) transits the Strait of Hormuz. Reuters reported significant disruptions to shipments through this route as the conflict intensified. Such shocks extend beyond the oil market, affecting interest rates, transportation costs, industrial margins, household expenditures, and economic growth prospects. Consequently, the situation represents more than a transient geopolitical event.
Reuters' market coverage consistently emphasised that rising energy prices were complicating efforts to control inflation. On 19 and 20 March, traders reduced expectations of interest rate cuts and increasingly considered the possibility of prolonged restrictive monetary policy. While Europe appeared particularly vulnerable due to its dependence on imported energy, the adjustment in market expectations was widespread. This episode represented an inflationary shock transmitted through energy markets, rather than a mere reaction to geopolitical uncertainty.
This explains why asset movements were less clear-cut. Usually, during geopolitical scares, it’s easy to see which assets are safe havens and which are risky. But in an inflation-driven oil shock, that distinction is less obvious. Some assets do well at first, then struggle as markets expect higher yields, fewer rate cuts, and slower growth. This context makes Bitcoin’s resilience interesting.
It had none of oil’s direct support, but it also did not fall the way many expected. Reuters’ 18 March report on cryptocurrency in the Gulf said Bitcoin had risen since the conflict began, even as the region’s business and logistics sectors came under strain. That does not settle the debate over what Bitcoin is, but it does challenge a simplistic risk-on, risk-off reading.
The comparison becomes more interesting when Bitcoin is set beside the other major assets. From 27 February to 20 March, oil rose sharply, Bitcoin posted a modest gain, and both gold and the S&P 500 fell. Bitcoin was not the top performer, but it was clearly not the easy loser either. In a market that punished gold and equities as inflation was repriced, Bitcoin ended up in a more resilient position than many expected.
Bitcoin is not reliant on physical infrastructure such as ships, ports, pipelines, refinery operations, or tanker insurance. While it remains sensitive to macroeconomic stress, it is unaffected by disruptions to cargo movement through the Strait of Hormuz. In a conflict where energy transportation was the primary stressor, this distinction may have been significant. Although this is an inference rather than a direct quotation, it aligns with the market dynamics described by Reuters across oil, interest rates, and risk sentiment.
Fund flow data support this interpretation. Bank of America Global Research reported $1.0 billion in cryptocurrency inflows during the most recent week, compared with $23.5 billion into cash and $4.5 billion in gold outflows. While this does not indicate that investors now view Bitcoin as a superior safe haven to gold, it does demonstrate that cryptocurrency was not indiscriminately sold during the escalation of the conflict.
Another noteworthy detail is that, immediately following the strikes, Reuters reported a sharp increase in funds leaving Iranian cryptocurrency exchanges, with over $2 million withdrawn in the first hour. While this movement alone does not drive global prices, it illustrates that cryptocurrency can serve as a practical tool for responding to stress within conflict zones, rather than merely functioning as an abstract investment vehicle.
Gold's performance is particularly noteworthy. At the onset of the conflict, bullion appreciated as anticipated, with Reuters' 1 March coverage documenting gains amid investor safety-seeking. However, this increase was not sustained. By 23 March, Reuters reported that spot gold had declined 15% from the start of hostilities and was 22% below its January record high. The scorecard indicates a 10.4% decrease by 20 March. Thus, gold transitioned from an initial safe-haven response to an adverse reaction amid rising interest-rate expectations.
This reversal is significant, as it indicates that the market response was not solely driven by risk aversion. While gold typically performs well during periods of heightened uncertainty, it can underperform when markets focus on higher oil prices, reduced expectations for rate cuts, and a stronger dollar. Reuters attributed the gold sell-off to rising interest rate expectations, which pose a challenge for non-yielding assets. Thus, the conflict that initially appeared beneficial for gold ultimately proved detrimental once inflation and monetary policy considerations became dominant.
Equities were similarly affected by these dynamics. On 20 March, Reuters reported that Wall Street declined as the conflict entered its fourth week, with investors increasingly concerned that elevated oil prices would sustain inflation and keep interest rates high. During the observation window, the S&P 500 fell by 5.4% from 27 February to 20 March. Subsequent Reuters coverage indicated that while the U.S. market performed better than some international counterparts, it was nonetheless negatively affected by the same oil and interest-rate pressures.
This is why the usual asset labels were not enough for this episode. Gold, usually treated as a safe haven, was hit by rising rate expectations. Equities, despite earnings support, came under pressure from inflation and growth concerns. Bitcoin sat in a less familiar position and showed more resilience than many expected. That does not settle the debate over how Bitcoin should be classified, but it does show the limits of the old framework in this kind of shock.
Markets were already drawing comparisons with the first weeks after Russia’s invasion of Ukraine in 2022, because both episodes were inflationary energy shocks. Brent crude's volatility in 2026 had already matched the turbulence observed in early 2022. This context highlights that the current situation is not a typical geopolitical disturbance, but rather a conflict capable of fundamentally altering market dynamics through energy channels.
Bitcoin's performance in 2022 offers an additional perspective. The leading cryptocurrency declined sharply on the day of Russia's invasion of Ukraine in February 2022, a point often cited by critics of the safe-haven narrative. However, this decline was temporary; by 22 March 2022, Bitcoin had risen over 26% from its intraday low on invasion day, and by 29 March it was up more than 27% since the invasion.
The appropriate historical lesson is not that Bitcoin benefits from conflict, as such a claim lacks evidence. Rather, Bitcoin's behaviour during periods of conflict has been mixed, occasionally demonstrating unexpected resilience, particularly when markets are influenced by inflation, policy considerations, and risk aversion.
A single period of resilience does not resolve the safe-haven debate. Despite gains since the conflict began, Bitcoin remained approximately 15% lower for the year, which is inconsistent with the characteristics of a traditional safe haven. It is more accurate to state that Bitcoin has demonstrated greater resilience than anticipated.
The current conflict indicates that Bitcoin does not neatly fit into traditional asset classifications. In some shocks, it behaves like a speculative asset, while in others—particularly when energy, inflation, and market responses are central—it shows unexpected resilience. This observation is significant and merits discussion, provided that the claims remain consistent with the available evidence.
Looking ahead, oil remains the primary variable to monitor. Should crude prices decline amid de-escalation, inflationary pressures may subside, influencing bond yields, the dollar, equities, and gold. Conversely, if oil prices rise due to prolonged shipping disruptions or an escalation of the conflict, inflation concerns will reemerge. Reuters' late-March market coverage consistently emphasised oil's central role in the broader market narrative.
Another key question is whether gold can recover. If bullion rises as oil stabilises and rate concerns ease, markets may return to a more traditional wartime hierarchy. If gold remains weak while tensions stay elevated, this would support the view that the current conflict has disrupted some established cross-asset relationships.
Finally, Bitcoin's ongoing performance warrants attention. The critical question is whether it can maintain resilience if the conflict persists, interest rates remain elevated, and the dollar stays strong. Should this occur, market participants may need to reconsider Bitcoin's role, viewing it as a complex macro asset rather than relying on simplistic classifications. This represents the principal insight from the current analysis.
Disclaimer & Citation
This material is for information only and does not constitute a recommendation or advice from EBC Financial Group and all its entities (“EBC”). Trading Forex and Contracts for Difference (CFDs) on margin carries a high level of risk and may not be suitable for all investors. Losses can exceed your deposits. Before trading, you should carefully consider your trading objectives, level of experience, and risk appetite, and consult an independent financial advisor if necessary. Statistics or past investment performance are not a guarantee of future performance. EBC is not liable for any damages arising from reliance on this information.
