Possible scenario
Limited Regional Escalation
30% Chance
Saudi Arabia, possibly with US intelligence and air-defense support, responds to tanker attacks with strikes on Houthi launch sites and oil-related facilities. Iran avoids an overt declaration of war but increases deniable pressure through proxies and harassment in the Gulf of Oman.
Initial impacts
- Riskier companies' borrowing costs Up
- 10-year Treasury yield Down
- Market volatility Up
- Oil prices Up
- US dollar Up
Secondary impacts
- Energy +2.6%
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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