Uploaded April 2026 | Updated September 2026, 1 week ago
The month of March 2026 was dominated by one story - the war in Iran and how it would play out. The month started with questions about how long the war would last and what effects it would have on the region and on global economies in the short and long term, and it ended with those questions still unanswered. As you try to make sense of competing narratives from experts (sell-anointed and real), you may want to check out the narrative in the market. I use market data, starting with oil prices and interest rates, and moving on to risk premiums, to conclude that, at least so far, this has been a market that is trying to reassess value, given the economic consequences of war, rather than one driven by panic. Oil prices are up strongly, but there are geographic and time variations, with Brent rising more than West Texas crude, and spot prices surging more than future. Equity risk premiums, bond spreads and the volatility index are all up, but not in the magnitudes that you would see in crisis market.
Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/WarandOil.pdf
Blog Post: aswathdamodaran.blogspot.com/2026/04/oil-war-and-global-economy-markets.html
Data:
Day-by-day ERP: https://pages.stern.nyu.edu/~adamodar/pc/blog/AlldataMarch2026.xlsx
ERP by country (updated to March 31, 2026): https://pages.stern.nyu.edu/~adamodar/pc/datasets/ctrypremApr26.xlsx
The month of March 2026 was dominated by one story - the war in Iran and how it would play out. The month started with questions about how long the war would last and what effects it would have on the region and on global economies in the short and long term, and it ended with those questions still unanswered. As you try to make sense of competing narratives from experts (sell-anointed and real), you may want to check out the narrative in the market. I use market data, starting with oil prices and interest rates, and moving on to risk premiums, to conclude that, at least so far, this has been a market that is trying to reassess value, given the economic consequences of war, rather than one driven by panic. Oil prices are up strongly, but there are geographic and time variations, with Brent rising more than West Texas crude, and spot prices surging more than future. Equity risk premiums, bond spreads and the volatility index are all up, but not in the magnitudes that you would see in crisis market.
Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/WarandOil.pdf
Blog Post: aswathdamodaran.blogspot.com/2026/04/oil-war-and-global-economy-markets.html
Data:
Day-by-day ERP: https://pages.stern.nyu.edu/~adamodar/pc/blog/AlldataMarch2026.xlsx
ERP by country (updated to March 31, 2026): https://pages.stern.nyu.edu/~adamodar/pc/datasets/ctrypremApr26.xlsx
