This blog post uses FRED to analyze market responses during the 2026 U.S.-Israeli military action against Iran.

Timeline

In 2025, the International Atomic Energy Agency (IAEA) raised international concerns about Iran’s nuclear program. The US and Israel struck Iranian nuclear sites in June 2025, and tensions rose again in January and February 2026. On February 27, 2026, the Associated Press reported that the IAEA could not verify that Iran had suspended “all enrichment-related activities.” Three subsequent events substantially moved oil and equity prices.

• February 28, 2026: The US and Israel initiated military action against Iranian military, government, and nuclear sites.
• March 1, 2026: Media outlets reported shipping disruptions—specifically, damage to and obstruction of oil tankers in the Strait of Hormuz.
• April 13, 2026: The US implemented a naval blockade of Iran’s ports.

Market responses

We track how three asset prices have behaved around these three recent events, which are shown in the graph as dashed vertical lines:

• Brent Crude Oil Prices.
• West Texas Intermediate (WTI) Crude Oil Prices.
• The CBOE Volatility Index.

Brent prices reflect conditions in European oil markets, which are largely dependent on supplies from the North Sea and Persian Gulf. West Texas Intermediate (WTI) prices reflect domestic supply and demand in US oil markets. Brent prices exceeded WTI prices by as much as $20 or $30 a barrel prior to 2015, the year the US lifted the ban on exporting its own crude oil to other countries.

Since 2015, arbitrage has prevented all but modest deviations in Brent and WTI prices over the long-term, but transportation costs, existing contracts, and delivery delays have allowed significant divergence over weeks and months.

The CBOE Volatility Index (VIX) measures 30-day-ahead S&P 500 (stock market) volatility and is often considered a measure of fear in financial markets.

The recent data can be interpreted as follows:

• Minimal oil price movement before February 28, 2026, suggests the military strikes caught markets off guard.
• The joint movement of oil prices and VIX in the first week of March is consistent with broad market pressures.
• Initial oil price movements in the first week were basically appropriate for the price of US crude (WTI) but understated the eventual $50 rise in Brent in European markets, which depend on oil from the Persian Gulf region.
• After March 15, a gap widened between WTI and Brent prices—which normally track closely—demonstrating that disruptions to Persian Gulf tanker traffic affected European markets more than US markets.
• The persistence of the gap between WTI and Brent prices will reflect how long it takes for markets to return to their equilibrium as futures contracts are delivered and oil is rerouted.

How this graph was created: Search FRED for “Brent Oil Prices.” To add a new line, click on “Edit Graph,” open the “Add Line” tab, search for “WTI Oil Prices,” and click “Add to graph.” Repeat for “CBOE Volatility Index.” To add vertical lines for each historical date, still in the “Add Line,” click on “Create user-defined line.” For each of the 3 dates—2/28/2026, 3/1/2026, and 4/13/2026, enter the date as the starting and ending date, then set the values for the line to start at 60 and go to 130. Finally, select the date range for the graph as a whole: 2/21/2026 to 4/17/2026.

Suggested by Christopher Neely.

Our FRED graph above displays the average annual interest rates (also called yields) for three common types of retail bank and credit union deposits, as reported by Bankrate Monitor.*

• CDs/certificates of deposit. The funds are left on deposit for several months or years to collect a set interest rate. Withdrawing the funds early requires paying a penalty fee. (The dashed green line shows 1-year CDs, and the solid blue line shows 5-year CDs.)
• Savings accounts. Funds not needed for daily expenses earn a variable interest rate. There may be limits to how often or easily money can be withdrawn. (Shown by the dotted red line.)
• Checking accounts. Money used for daily expenses can be accessed by writing checks or by using automated teller machine (ATM) cards or debit cards. Some checking accounts offer a variable interest rate. (Shown by the dashed-dotted purple line.)

Bank accounts where funds can be withdrawn more easily or at low cost generally offer relatively lower interest rates. Put differently, accounts where funds are relatively harder to turn into cash will generally offer relatively higher interest rates to attract depositors.

So, we’d expect to see a 5-year commitment to storing funds to earn you a higher interest rate than a 1-year commitment. But what do the data show us?

Between October 2022 and the time of this writing, the average interest rate on a 1-year CD was reported to be higher than the average interest rate on a 5-year CD, due to uncertainty about future financial market conditions. This type of inversion in the expected structure of interest rates is discussed in a FRED Blog post from 2018 and further described here.

*FRED recently added 15 new series from the Bankrate Monitor National Index. These weekly data report average interest rates on checking and saving accounts, certificates of deposit, credit cards, auto loans, mortgages, and other lines of personal credit. The Bankrate data are collected weekly from a survey of the “10 largest banks and thrifts in 10 large U.S. markets.” Data on CDs are available since 1984, and data on other types of deposits were added in more recent decades.

How this graph was created: Search FRED for and select “Bankrate Monitor (BRM): Certificate of Deposit APY – 5 Year CD – APY.” Click on the “Edit Graph” button and select the “Add Line” tab to search for “Bankrate Monitor (BRM): Certificate of Deposit APY – 1 Year CD – APY.” Don’t forget to click on “Add data series.” Repeat the last two steps to add data on “Saving accounts” and “Interest checking accounts.”

Suggested by Diego Mendez-Carbajo.

Military conflict and geopolitical tensions in the Middle East tend to be associated with disruptions in the global supply of oil. These disruptions can raise both the level and the volatility of the price of oil. And rising oil prices have many direct and indirect macroeconomic effects.

• Oil is an important intermediate input in the production of goods—plastics, for example. So, increases in the price of oil can lead to increases in the prices of other final goods.
• Many households rely directly on gasoline for daily activities, such as commuting to work and visiting family.
• Households and businesses also rely on oil indirectly for electricity consumption.

Another channel through which oil prices may have macroeconomic effects is related to a country’s status as a net importer or exporter of this commodity: A rise in oil prices tends to harm net importers while benefiting net exporters. Is the US a net importer or a net exporter of oil?

Our FRED graph above helps us answer that question by displaying the time series of net exports of petroleum-related products for the US as a share of GDP. From 1985 (when data are first available) through 2020, the US was a net importer of oil. The series was negative during that period. The series became positive around 2020, indicating that the US became a net exporter. This change is primarily explained by rising exports of refined petroleum products, such as gasoline and jet fuel.

Our second FRED graph, below, displays imports and exports of petroleum and its related products separately, both divided by nominal GDP. This graph helps rationalize some of the trends that underlie the first graph: Imports of petroleum products as a share of GDP rose throughout the 1990s and 2000s. But this ratio has fallen, suggesting the US economy has become less dependent on oil. At the same time, technological improvements, such as the development of the shale oil industry, have led to an increase in the importance of petroleum exports as a share of GDP. It’s also worth noting that not all types of oil are identical: Different grades of oil have different uses, and the US economy tends to import crude oil while exporting refined petroleum products.

While an increase in the price of oil could benefit at least some sectors of the US economy, the fact that oil is a commodity with globally determined prices means that domestic consumers still pay more when supply disruptions occur and prices rise.

How these graphs were created: First graph: Search FRED for “exports of petroleum” (FRED series ID LA0000061Q027SBEA) and click on “Edit Graph.” Search for “imports of petroleum” (FRED series ID B648RC1Q027SBEA) and then “nominal GDP” (GDP). Apply formula (a-b)/c. Second graph: Repeat the above process for exports and GDP with formula a/b, then open the “Add Line” tab and repeat with imports and GDP.

Suggested by Miguel Faria-e-Castro.