World shares declined Thursday as the U.S. military announced further "defensive strikes" against Iran, while oil prices surged more than $2 a barrel. This immediate market reaction saw Germany’s DAX nearly unchanged at 25,175.63, Paris’s CAC 40 lose 0.4% to 8,172.84, and Britain’s FTSE 100 slump 0.9% to 10,416.62. Futures for the S&P 500 and Dow Jones Industrial Average also edged lower by 0.1%.
In Asian trading, Japan’s Nikkei 225 lost 0.5% to 64,693.12, South Korea’s Kospi lost 0.5% to 8,185.29, Hong Kong’s Hang Seng index shed 1.3% to 25,006.16, and Australia’s S&P/ASX 200 declined 1.4% to 8,592.90. Taiwan’s Taiex also dropped 1.4%, signaling a broad market apprehension following the projection of U.S. military power.
Who Profits
The escalation of military action directly translated into increased surplus extraction for oil corporations. Brent crude oil gained $2.14, reaching $94.44 a barrel, while benchmark U.S. crude gained $2.12 to $90.80. This surge followed a previous day's sharp decline, which had temporarily eased pressure on capital, with Brent crude falling 4.6% to $92.25 and U.S. crude falling 5.5% to $88.68.
Earlier in the week, U.S. stocks had inched to new records after oil prices fell more than 4%, easing pressure on consumers and businesses worldwide. This reduction in operating costs directly boosted the profits of companies with "big fuel bills." Norwegian Cruise Line Holdings climbed 6.1%, United Airlines rallied 6.3%, and Delta Air Lines rose 3%, setting an all-time high. These gains underscore how fluctuations in global resource prices directly impact corporate balance sheets.
Despite "painful inflation and uncertainty caused by high oil prices" that burden the working class, companies have reported "surprisingly strong profits for the start of 2026," with forecasts indicating continued gains. The S&P 500 edged up by less than 0.1% to 7,520.36, the Dow industrials rose 0.4% to 50,644.28, and the Nasdaq composite gained 0.1% to 26,674.73, all setting all-time highs. This demonstrates the system's capacity to concentrate wealth upward even amidst broader economic instability.
The State's Role
The U.S. military, acting as an imperial garrison, confirmed it shot down four Iranian one-way attack drones that posed a threat near the Strait of Hormuz. U.S. Central Command forces also targeted an Iranian ground control station in Bandar Abbas, which was reportedly preparing to launch a fifth drone. These actions followed previous strikes earlier in the week, reinforcing the state's role in securing strategic choke points for global capital.
President Donald Trump articulated the state's uncompromising stance, stating that Iran is “negotiating on fumes.” He further indicated that the "later in the current year" midterm elections would not compel him to rush into a deal to end the nearly three-month-old conflict. This position reveals how state policy prioritizes perceived leverage and geopolitical advantage over de-escalation.
Tan Boon Heng of Mizuho Bank highlighted the inherent contradictions of the current diplomatic efforts, noting that "conflicting reports on the contours of a U.S.-Iran deal dampened risks sentiments as markets grow increasingly wary about the possibility of a deal." Heng added that despite a "desire to maintain the ceasefire" and "toning down language" on renewed attacks, it "remains remarkably hard to envisage how a compromise can be reached on key issues," underscoring the limits of reform within existing power structures.
Who Pays
The ongoing military actions and subsequent oil price volatility impose a direct cost on the global working class. The "painful inflation and uncertainty caused by high oil prices" directly impacts "consumers and businesses worldwide," eroding purchasing power and increasing the cost of living. While capital celebrates surging profits, the burden of these geopolitical maneuvers falls disproportionately on those least able to bear it.
The strategic importance of the Strait of Hormuz, crucial for allowing oil tankers to exit the Persian Gulf for deliveries, remains central to these conflicts. The projection of military power by the U.S. serves to maintain control over these vital arteries of global capital accumulation, ensuring the uninterrupted flow of resources to fuel corporate profits, regardless of the human cost.