If you are watching the chaos unfurling in the Middle East and thinking, “This doesn’t affect me,” that might be because you live on the West Coast or in a large Northeastern metropolitan area.
Where you live determines the impact the war in Iran has on your personal finances, according to an analysis by Oxford Economics.
Since the U.S. and Israel launched attacks on Iran, the economic fallout has included rising oil prices and volatility in equity markets. Oil prices are of particular note because consumers feel the pinch at the gas pump in an environment where they are already sensitive to further pressures on affordability.
Oil prices have increased because Iran borders the Strait of Hormuz, a narrow waterway in the Persian Gulf through which exports from the UAE, Qatar, Kuwait, and Iraq all flow. Some 20 million barrels of oil typically flow through the strait every day, about 20% of the global oil supply. Iran has said it controls the strait, littering it with mines, and ship captains are too nervous to enter the waterway, choking off global supply and sending prices spiraling.
