Operation Epic Fury means new risks for markets

It’s a phrase you hear a lot on CNBC. Markets hate uncertainty, and the events of the past 48 hours have forever changed the face of international politics, with investors around the world scrambling to understand the implications.

Operation Epic Fury, a coordinated attack on Iran by American and Israeli forces, upended the world order since the end of World War II and ushered in a new era of politics in the Middle East and among international allies and adversaries alike.

Follow CNBC’s live updates for the latest developments.

How will markets and investors react? What is a sudden reaction compared to the long-term adjustments needed to your investment strategy?

Here are some assets to watch this week.

Stock markets across the Middle East came under pressure on Sunday as stocks traded for the first time since the attack. Saudi Arabia’s Tadawul, Oman’s Muscat Index and Bahrain Exchange are all trading in the red, and many other markets in the region are not open. Indexes in Dubai, Abu Dhabi and Israel are scheduled to resume trading on Monday. This impact is expected to ripple throughout the global market.

The oil market will be the epicenter of volatility in the wake of the attack. Traders expect Brent oil prices to rise above $80 a barrel, Verisk Maplecroft said. The outlook comes despite OPEC’s recent decision to increase production earlier than previously planned.

The closure of the Strait of Hormuz will further exacerbate oil price volatility. Global shipping companies including Maersk, MSC and Hapag-Lloyd have suspended all vessel traffic through the route until further notice. Iran’s Revolutionary Guards claimed to have attacked a number of tankers in the Gulf in retaliation. It is unclear when the strait will reopen. Some ships were rerouted around Africa, increasing shipping time and costs.

Since the airstrikes began, nearly all airspace in the Middle East region has been closed, causing major disruption to air travel. More than 1,500 flights were canceled across the region on Sunday, and aviation tracking site FlightAware said more than 19,000 flights were delayed worldwide. Airlines are expected to remain under pressure as they work to restart routes and arrange repatriation flights.

The strike also intersected with the market’s broader focus on artificial intelligence. Until recently, investors were focused on AI’s potential to reshape industries around the world. Although the subject matter may seem far removed from events in Iran, there appears to be some overlap between the two. The U.S. military used Anthropic’s Claude AI technology to support attacks on Iran, even though Anthropic was blacklisted by the Pentagon over how the technology was used, according to an Axios report. Anthropic has resisted the Pentagon’s request to allow unrestricted military use of the Claude, and the Pentagon has moved to classify the company as a “supply chain risk” over the dispute.

It’s still unclear how the rest of this week will play out. President Donald Trump told CNBC’s Joe Kernen that U.S. military operations in Iran are “ahead of schedule.” In a market frightened by uncertainty, it is the “known unknowns” that make investors anxious.