Oil prices have fallen roughly 39% from their March peak, and the ripple effects are showing up everywhere. US Treasury prices are climbing, equities are rallying, and for a brief window, markets are acting like the worst of the Middle East conflict might be in the rearview mirror.
The numbers behind the relief rally
Brent crude dropped from nearly $118 per barrel in March 2026 to approximately $72 in early July. That’s the kind of decline that makes central bankers sleep a little easier, since cheaper oil means less inflationary pressure across the entire economy.
Treasury markets responded accordingly. The 10-year yield, which had climbed to 4.6% during the worst of the conflict-driven inflation scare, pulled back as oil’s descent took some heat off the inflation outlook.
Equities, meanwhile, have been surprisingly unfazed by the geopolitical chaos. The S&P 500 rose 17.3% from March 30 to July 24, a performance that would be impressive in peacetime, let alone during an active military conflict involving three nations.
