Alicia Levine, chief investment officer at BNY Wealth, warned that a prolonged war involving Iran could become the financial market’s “black swan, ” emphasizing the risk that the conflict may last longer than investors expect.
Levine said many people appear to assume the war will end soon, adding that a worse outcome would otherwise be expected. Her comments, made during an interview in London, identified the conflict’s duration—not simply its existence—as the central uncertainty for markets.
Other market assessments have also focused on the possibility of a drawn-out conflict. The Strait of Hormuz has been described as effectively closed to most shipping because of insurance concerns, risks to vessels and fatalities among sailors. Oil prices have moved above $100 a barrel, while European natural-gas prices have nearly doubled since the end of February.
The disruption has increased concern about inflation and interest rates. Treasury yields have moved higher as investors reduced expectations for Federal Reserve rate cuts, while market pricing for European central-bank policy has shifted toward possible rate increases. Higher energy costs have also raised concern about slower growth and a potential stagflationary outcome.
The conflict’s effect has varied across markets. A stronger dollar and higher oil prices have pressured Asian stocks, while Europe remains particularly exposed because of its dependence on imported energy. AI-related shares have also struggled during 2026, adding uncertainty to the backdrop for a possible Anthropic initial public offering, which Levine addressed separately with the response “Godspeed.”
A rapid resolution remains possible, but the consequences of a longer war would be more severe if energy restrictions persisted.