Possible scenario
Diplomatic De-escalation
20% Chance
Oman, the UN, and regional intermediaries use the shock of the coastal capture to reopen talks on a local ceasefire and maritime assurances. This is plausible because all sides face high costs from a prolonged Red Sea crisis, even if a comprehensive Yemen settlement remains distant.
Initial impacts
- Riskier companies' borrowing costs Down
- Market volatility Down
- 10-year Treasury yield Up
- Oil prices Down
- US dollar Down
Secondary impacts
- Energy -1.5%
Portfolio impact
S&P 500+1.0%
Each figure is the modeled move of the S&P 500 if the outcome occurs. For information only. Not investment advice.
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