Energy Shock Tests Global Resilience as Middle East Conflict Escalates

Northern Trust’s weekly economic commentary assesses how escalating hostilities involving Iran are transmitting through global energy markets while AI anxieties shape labor market debates. 

• Oil prices have risen roughly 18% and global natural gas prices have surged as maritime traffic through the Strait of Hormuz—handling about 20 million barrels per day—faces disruption.

• Energy shocks could act as a tax on consumers and force monetary and fiscal recalibration if supply disruptions expand beyond transport into production.

• AI adoption remains gradual: only 10% of firms used AI in production in 2025, suggesting concerns about rapid labor displacement remain overstated.

How long energy disruptions persist may determine whether the global economy absorbs another shock—or faces a deeper inflationary impulse.