Retail investors rush into energy and safe‑haven assets as markets price in Iran–US conflict risks.
Dubai: The escalating Middle East conflict is starting to reshape global trading patterns, driving up demand for oil and gold while stoking concerns over energy supply, shipping disruptions, and rising war-risk insurance costs.
Retail trading activity surged, with oil becoming the second most-traded asset in a single session on the trading platform Capital.com. Platform data showed that active traders rose 49%, trading volumes jumped 73%, and executed trades increased 82% compared with the previous Friday.
The spike in activity highlights how retail investors are adjusting portfolios amid growing global market uncertainty. Energy and precious metals attracted the most attention, as traders reacted to potential supply disruptions and rising volatility.
Oil trading jumps
Oil rapidly emerged as one of the most actively traded assets on the platform as geopolitical tensions escalated. Retail investors moved swiftly into energy markets, responding to growing concerns over potential supply disruptions caused by the conflict.
Key shifts in oil trading
Between Friday and Monday, retail trading on Capital.com saw dramatic changes in response to rising geopolitical tensions:
- 1,255% surge in first-time traders entering the oil market
- 276% increase in active oil traders in a single day
- Oil jumped from 6th–7th place to the second most-traded instrument on the platform
- 649% rise in oil trading volumes
Market sentiment also turned markedly more bullish:
- 51% of traders held long positions on Friday
- 75% were long by Monday
The data indicates that traders quickly reassessed their exposure to energy markets as geopolitical risks intensified.
Gold demand rises
Gold trading surged as investors sought protection from heightened market volatility. The precious metal remains a widely recognized safe-haven asset during periods of geopolitical uncertainty.
Between Friday and Monday, trading activity on Capital.com showed significant gains:
- 103% increase in gold trading volumes
- 87% rise in total trades
- 61% growth in active traders
Gold continued to be the most-traded instrument on the platform throughout the week. Investor sentiment also turned more bullish, with 58% of traders holding long positions on Friday, rising to 66% by Monday.
The data suggests that retail investors are positioning for continued volatility in global markets amid escalating geopolitical risks.
Traders reposition amid Middle East tensions
Kyle Rodda, senior market analyst at Capital.com, said precious metals have long been popular with retail traders, with demand often rising during periods of geopolitical uncertainty.
“Precious metals, especially gold, are typically a perennial favourite of retail traders,” Rodda said. “However, extraordinary uncertainty regarding global geopolitics, trade, and economic policy has only seen interest surge, with the crisis in the Middle East stoking that further.”
He noted that the most dramatic shifts in activity have occurred in energy markets, as traders respond to potential supply risks.
The significant shift in activity has been in the energy complex, as traders reassess their exposure to the volatility caused by the conflict in the Middle East,” Rodda added. “The risk of meaningful supply disruptions in the region is driving considerable bullish positioning for crude, though some traders have begun to fade that move following the initial spike.
Shipping disruption
The escalating conflict is also disrupting shipping through the Strait of Hormuz, one of the world’s most critical energy corridors. The strait carries more than 20 million barrels of crude and fuels each day, roughly one-fifth of global oil consumption, according to Vortexa.
Traffic slowed sharply following Israeli–U.S. strikes on Tehran and Iran’s warning that vessels attempting to pass through the strait could be targeted. Shipping reports indicate that at least nine vessels have been damaged since the conflict began.
Currently, around 200 ships are waiting in waters near major Gulf producers as operators assess the security situation. Some vessels are being rerouted away from the region to reduce exposure to risk.
War insurance surge
Insurance costs for ships transiting the region have soared sharply amid rising risks. In some cases, war-risk premiums have surged by more than 1,000%, significantly increasing the cost of transporting energy cargo.
Stephen Rudman, head of marine for Asia at insurance broker Aon, said insurers have reacted quickly to the heightened threat.
“The hull war market has reacted more immediately,” Rudman said. Additional premiums for vessels transiting high-risk waters are rising sharply and may continue to fluctuate in the short term.
Analysts at Jefferies estimate that potential industry losses from vessels already damaged could reach up to $1.75 billion.
Most tankers are valued between $200 million and $300 million, making them highly exposed to conflict-related risks. Prior to the escalation, hull war-risk insurance typically cost around 0.25% of a vessel’s value, or roughly $625,000.
With new rates approaching 3%, premiums could rise to about $7.5 million per vessel, highlighting the sharp increase in perceived risk for ships operating in the region.
Supply chain pressure
Insurance brokers say war-risk premiums vary depending on vessel type and exposure to the conflict zone. Current estimates place rates between 1% and 1.5% of a vessel’s value, according to Dylan Mortimer, marine hull UK war leader at insurance broker Marsh.
Shipping under pressure
About 1,000 vessels are currently operating in Gulf waters, with a combined hull value exceeding $25 billion, according to the Lloyd’s Market Association.
Shipping companies have also introduced war surcharges ranging from $2,000 to $3,500 per container when port operations are disrupted. Analysts warn that supply chains could face further pressure if vessels are forced to reroute around Africa’s Cape of Good Hope, adding travel time and transportation costs.
Governments explore solutions
Authorities are now exploring ways to stabilise maritime traffic and safeguard global energy supplies amid rising geopolitical tensions in the region.
U.S. security measures
U.S. President Donald Trump said the U.S. Navy could escort oil tankers through the Strait of Hormuz if necessary, aiming to ensure the continued flow of energy shipments through the critical waterway.
Trump also instructed the U.S. International Development Finance Corporation to provide political risk insurance and financial guarantees for maritime trade in the Gulf.
Analysts caution that it remains unclear whether these measures will quickly restore normal shipping activity, and markets are likely to remain sensitive to developments in the region.
