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Geo Political War Risk Premium — How Conflict is Fueling Commodity Prices<

Jun 20, 2025

Video: Geo Political War Risk Premium — How Conflict is Fueling Commodity Prices


Rising tensions between Iran and Israel are driving crude oil and wheat futures higher, as the Persian Gulf and Strait of Hormuz remain critical trade routes for oil, wheat, and fertilizer. Meanwhile, excessive rain in U.S. winter wheat regions, combined with drought in Europe, Russia, and Western Canada, has triggered a classic fund short-covering rally in wheat. A brief U.S. heat wave could stress Central Corn Belt crops, while Western Canada urgently needs weekend rains—or canola could spike to $800–$850. Despite global turmoil, the U.S. Fed is holding steady, with strong consumer spending, economic resilience, and continued MAG 7/AI demand buying time amid tariff and war uncertainty.