New geopolitical conflicts in the Middle East have created a new wave of uncertainty and volatility in the S&P 500 index and the rest of the global markets. However, one specific market has become the poster child of all this uncertainty, and that is the energy sector, particularly regarding oil prices. The price of oil rallied from the $60-per-barrel range to nearly close in on $80 per barrel.
Since the conflict between Israel and Iran started, Iran has decided to close down the Straight of Hormuz, a strategic and severely important location for the supply chain logistics in oil. This means that oil prices have nowhere to go but up from here. This is not good news for the transportation sector, which is heavily reliant on fuel costs, particularly for airlines.
