Oil Prices Explode: How Investors Can Profit from Iran Conflict

The escalation in the Middle East has reached energy markets. Oil prices climbed to nearly $120 at their peak (as of March 2026, source: Tagesschau), while gas prices temporarily doubled. For investors in the DACH region, this represents a new challenge: on one hand, rising commodity prices offer profit opportunities, but on the other hand there is a toxic mix of inflation, rising interest rates, and falling stock prices. The DAX has already recorded significant losses.

Key Points: What Investors Need to Know

• Oil prices climbed to nearly $120 at their peak, gas prices temporarily doubled since the start of the Iran war
• The ECB projects a price increase of 2.6 percent for 2026; if oil prices remain above $100, inflation could rise above three percent
• Chief Economist Edgar Walk from Bankhaus Metzler expects eurozone inflation of three to four percent in the next six to nine months
• Gold and oil rise significantly, while the DAX records strong losses
• Oil market analyst Vandana Hari from Vanda Insights expects oil prices to trade in a tight range for the foreseeable future
• Europe is less dependent on oil today than in the 1970s, but the risk has shifted to electricity and gas

How Much Are Energy Prices Really Rising?

The figures speak for themselves: since the start of the Iran war, oil prices climbed to nearly $120 at their peak (source: Tagesschau). This represents a rise of around 50 percent compared to prices at the beginning of the year. Meanwhile, gas prices temporarily doubled, which is particularly relevant for Europe.

However, oil market analyst Vandana Hari from Vanda Insights does not expect a sustained explosion upward. According to her assessment, oil prices should trade in a narrow range for the foreseeable future. Markets react sensitively to every piece of news from Iran – geopolitics drives volatility, not fundamental supply and demand data.

The problem for commodity investors: uncertainty is poison for long-term positions. Commodities are traded partly far into the future and depend on reliable forecasts. In the current situation, where both parties are attempting talks while simultaneously maintaining the threat, theoretically anything is still possible.

Is a New Inflation Shock Looming for the Eurozone?

Higher energy prices have a particularly rapid effect on the inflation rate. Rising oil prices immediately translate into higher costs for petrol and heating oil and simultaneously increase transport and production costs. The European Central Bank (ECB) projects a price increase of 2.6 percent for 2026 – but this forecast dates from before the latest escalation.

The duration of the conflict is decisive. If it is resolved quickly, oil prices should fall promptly and at most temporary inflation distortions could occur. However, should oil prices remain on average at $80 or above $100 for an extended period, this would have sustained effects on inflation, according to Sonja Marten, Chief Economist of DZ Bank (source: Tagesschau).

Chief Economist Edgar Walk from Bankhaus Metzler predicts in this scenario that the inflation rate in the eurozone over the next six to nine months should rise "to above three percent, perhaps even toward four percent" (source: Tagesschau). This would put the ECB under pressure and could jeopardize the hoped-for interest rate cut policy.

An important difference from the 1970s: Europe is less dependent on oil today. However, the risk has shifted – oil has been replaced by gas and electricity in many areas, which makes economies vulnerable to other energy price shocks.

Which Investment Strategies Work Now?

Direct Investments in Oil and Gas

Investors who want to bet on further rising oil prices have several options. The most direct form is crude oil futures or exchange-traded commodities (ETCs) on Brent or WTI. An ETC is an exchange-traded security that tracks the price development of a commodity without requiring investors to store physical barrels.

The risk: high volatility makes these instruments suitable only for experienced investors. If someone enters at $120 and the conflict is unexpectedly resolved, they can suffer a 20 to 30 percent loss within days. At the same time, there is the opportunity to profit from further price increases if the situation escalates.

Shares in Oil and Gas Companies

A more moderate alternative is shares in established energy companies. These benefit from higher oil prices through increased margins, but at the same time offer dividends and are less volatile than direct commodity investments. Moreover, investors can here rely on diversified business models that also include renewable energies.

The disadvantage: energy stocks do not react one-to-one to oil price movements. Regulatory risks, corporate governance, and general stock market sentiment also play a role. With a weak DAX and a fragile Wall Street, even energy stocks can come under pressure.

Gold as Insurance

Gold rises significantly in parallel with oil and fulfills its classic function as a safe haven during geopolitical crises. The geopolitical situation, fear of economic crises, and the high indebtedness of Western states strengthen the desire for a safe haven, which gold continues to fulfill (source: Goldherzreport).

For investors in the DACH region, this means: gold serves as portfolio insurance against the combination of rising inflation and falling stock markets. Those who already had gold in their portfolio before the crisis now benefit from this diversification. However, the Goldherzreport also warns that precious metals can fall in phases despite the Middle East conflict – a linear upward movement is not guaranteed.

What Does the Toxic Mix Do to Stock Portfolios?

The combination of rising commodity prices, looming inflation, and interest rate concerns is particularly dangerous for stock investors. The DAX is losing ground significantly, Wall Street shows weak opening tendencies (source: Welt). At the same time, gold and oil prices are rising significantly – a toxic mix, especially if investors panic.

Panic selling worsens the situation. Anyone who hastily exits stocks now realizes losses and may miss the recovery once the geopolitical situation calms down. On the other hand, there is the risk that sustained inflation will erode corporate profit margins and put stock valuations under long-term pressure.

Experts warn of a similarly drastic development as in earlier oil price crises, should crude oil remain at a high price level for a long time due to the Middle East war (source: finanzen.net). 2026 could become a stress test for the DAX.

How Does the ECB Respond to Rising Energy Prices?

The European Central Bank faces a dilemma. On one hand, it had indicated further interest rate cuts for 2026 to support the economy. On the other hand, an inflation rate of three to four percent could force it to act. Economists expect that the ECB would likely respond quickly should energy prices remain elevated on a sustained basis (source: Tagesschau).

For investors in the DACH region, this means: rising interest rates burden bonds and make stocks relatively less attractive. At the same time, higher interest rates could strengthen the euro, which benefits Swiss investors but strains German and Austrian investors in international investments.

Conclusion: Seize Opportunities, Manage Risks

The Iran conflict does offer investors profit opportunities – provided they understand the risks and act prudently. Direct investments in oil are highly volatile and suitable only for experienced investors. Energy stocks offer a more moderate alternative but suffer from general stock market weakness. Gold fulfills its function as portfolio insurance but does not guarantee linear profits.

The decisive question remains: how long does the conflict last? If it is resolved quickly, markets should calm down rapidly and oil prices should fall promptly. However, if escalation continues, an inflation shock threatens that would force the ECB to act and burden stock portfolios. Investors should now focus on diversification and avoid panic sales – even if the temptation is great in volatile times.