The JCI dropped 1.7% due to rising tensions in the Middle East. The situation in Iran escalated following an Israeli strike on June 13, carried out without U.S. involvement. Earlier, the U.S. had stated it would give Iran time to negotiate. However, on Saturday night into Sunday, the U.S. launched an attack on three of Iran’s nuclear facilities in an operation named “Midnight Hammer.” Israel required U.S. technology to neutralize Iran’s deeply buried nuclear sites. In response, Iran fired missiles toward Israel and threatened to attack all U.S. military forces in the Middle East, also warning it would shut down the Strait of Hormuz. If closed, oil production from Saudi Arabia, Iraq, Kuwait, Qatar, the UAE, and Iran would be disrupted. This region accounts for roughly 20% of global oil output, and oil prices are expected to rise if the strait is closed.

Historically, oil price spikes caused by war-related conflicts have become shorter in duration. However, if the war drags on and leads to a change in government, it could pose serious risks. Currently, oil prices have eased back below USD 80 per barrel. If oil prices climb again, U.S. inflation could resurface—something the U.S. government is keen to avoid. We suggest investors maintain their equity positions, as Iran may not be able to withstand the technologically superior U.S. military. This correction should be seen as an opportunity to gradually accumulate positions while closely monitoring developments.

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For More Information

Contact Mandiri Investasi – (021) 526 3505
Email Mandiri Investasi – [email protected]
Mandiri Investasi – www.mandiri-investasi.co.id

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The opinions expressed in this article are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or security or investment product. This content is intended solely for educational purposes regarding the financial industry. The views expressed may change at any time without notice. All performance data and investment returns mentioned in this article are not guarantees for future results. They are based on historical data and should not be used as a basis for making decisions to buy or sell securities. Investment in mutual funds carries risk. Investors must read and understand the prospectus before deciding to invest in mutual funds.

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