How will Middle Eastern geopolitical risks reshape the market? A review of the capital flow logic of crude oil, gold, and Bitcoin

February 28, 2026, the US and Israel launched a military strike against Iran, which then retaliated, causing a sudden escalation of Middle Eastern geopolitical conflict. This event quickly transmitted to global financial markets: as traditional safe-haven assets, gold and crude oil prices surged, while the 24-hour crypto markets experienced intense volatility. Bitcoin briefly fell below $63,500 before rebounding above $67,000. This review aims to objectively analyze the linkage and divergence paths of crude oil, gold, and Bitcoin under the impact of this geopolitical event.

Timeline of Escalation and Market Response

On the afternoon of February 28, the US and Israel launched a military attack on Iran, which responded with strikes against Israeli and US military bases in the Middle East. On the same day, President Trump announced on social media that Iran’s Supreme Leader had been killed.

As a result, traditional financial markets reacted before the weekend closure: by February 27 close, Brent crude rose 3.35% to $73.21 per barrel, and London spot gold increased 1.88% to $5,278.33 per ounce. Due to the 24/7 trading nature of cryptocurrencies, they were among the first to reflect the escalation: after the news, Bitcoin briefly dropped near $63,500, then quickly recovered, closing above $67,000 by March 1.

Data and Structural Analysis: Divergence Logic of Crude Oil, Gold, and Bitcoin

As of March 2, 2026, based on Gate market data, Bitcoin traded above $67,000. From an asset property and market structure perspective, these three asset classes show clear divergence logic in this event:

• Crude Oil Supply Shock Logic: Iran is the third-largest OPEC oil producer, accounting for about 3% of global supply, and controls the Strait of Hormuz, a critical chokepoint for global oil shipping. Geopolitical conflict directly threatens supply, prompting markets to price in risk premiums. Institutional views suggest that if the Strait of Hormuz is affected, oil prices could rise further.

• Gold as a Safe-Haven and Inflation Hedge: Gold’s rise is driven by two forces: one, geopolitical safe-haven demand, with funds shifting from risk assets to non-sovereign, credit-risk-free hard assets; two, inflation expectations, as rising oil prices may boost global inflation, increasing gold’s attractiveness as an inflation hedge.

• Bitcoin’s Safe-Haven Attribute Controversy: In this event, Bitcoin’s price behavior shows an internal conflict between two narratives: risk assets and digital gold. Initially, Bitcoin declined with risk assets during the sell-off, but then stabilized and rebounded. Options market data indicate mixed institutional activity: long-term holdings still favor call options (put/call ratio 0.75), suggesting long-term capital has not exited significantly; however, within 24 hours, put options volume surged (volume PCR 1.37), indicating increased short-term hedging demand. This suggests the market has not formed a consensus on Bitcoin’s safe-haven role; it is more viewed as a highly liquid “hedging tool” or “macro risk exposure asset.”

Public Opinion Analysis

Market interpretations of this event are multi-dimensional, summarized as follows:

• Crude Oil: Mainstream views hold that short-term oil prices are likely to rise, but the magnitude and sustainability depend on whether the conflict affects the Strait of Hormuz and other Middle Eastern oil producers. If confined locally, prices may spike temporarily and then revert to fundamentals; if supply chains are disrupted, sharp increases similar to early 2022 Russia-Ukraine conflict may occur.

• Gold: Most institutions are optimistic about gold’s long-term prospects, driven by continued central bank gold buying, de-dollarization trends, and increased safe-haven demand amid frequent geopolitical tensions. Short-term, gold’s trajectory depends on conflict intensity and scope, with high volatility likely to persist.

• Bitcoin: Market opinions are divided. Optimists believe Bitcoin, as a “non-sovereign hard asset,” will benefit from fiat currency crises and inflation expectations, with options data pointing to a mid-term rebound around $76,000. Cautious voices warn that if oil prices remain high and inflation accelerates, central banks may tighten monetary policy further, suppressing risk assets.

Validity of Narrative Assumptions

It is important to objectively examine the logical boundaries behind these market narratives.

The transmission chain “Oil prices rise → Inflation expectations → Gold rises” is supported by historical experience and internally consistent. However, the narrative “Geopolitical conflict → Bitcoin rises” currently lacks consistent validation. In this event, Bitcoin’s price behavior aligns more with “liquidity-sensitive assets”: initial panic-driven sell-off, followed by a rebound driven by sentiment recovery and options gamma effects. Its “digital gold” attribute has not been the dominant factor in short-term price movements.

Historically, during the June 2025 Iran-Israel conflict, oil and gas prices surged in pulses and then retraced, indicating that without actual supply chain disruption, pure geopolitical risk premiums are hard to sustain. Similar distinctions apply here: the impact depends on whether there is “material supply interruption” or merely “risk premium driven by expectations.”

Industry Impact Analysis

This event’s potential impact on the crypto industry involves two levels:

• Macroe Level: If geopolitical tensions sustain and push oil prices higher, reinforcing inflation persistence, the Federal Reserve’s tightening cycle may extend, exerting macro liquidity pressure on all risk assets, including cryptocurrencies. Conversely, geopolitical risks might accelerate some funds’ search for non-sovereign stores of value, strengthening Bitcoin’s long-term case.

• Market Structure Level: The event highlights the price discovery role of crypto markets as “24-hour trading venues.” During traditional market closures, crypto perpetual contracts for oil and gold see increased volume, becoming a frontline for risk hedging. This phenomenon may encourage more institutional focus on crypto liquidity and risk management functions.

Multi-Scenario Evolution

Based on current developments, three possible future scenarios are outlined:

Scenario 1: Limited Conflict (Higher Probability)

Conflict remains localized, not affecting the Strait of Hormuz or nearby oil producers. Oil prices spike briefly then stabilize, risk premiums fade; gold remains high with oscillations as risk sentiment fluctuates; Bitcoin reverts to macro-driven logic, volatility diminishes.

Scenario 2: Escalation of Conflict (Medium Probability)

Fighting spreads to Lebanon, Red Sea, etc., disrupting Strait of Hormuz shipping, further constraining energy supply. Oil could surpass $100/barrel, gold benefits from safe-haven and inflation fears, entering a significant rally. Bitcoin faces dual pressures: short-term inflows from safe-haven demand, but potential valuation pressure if inflation triggers aggressive tightening.

Scenario 3: Full-Scale Confrontation (Lower Probability)

Iran blocks the Strait of Hormuz, leading to full-scale US-Iran war. Oil prices could soar to $120–150/barrel, gold becomes the ultimate safe-haven, reaching new highs. Bitcoin’s response is highly uncertain: it may benefit from fiat crises but could also suffer from global liquidity crunches and risk aversion.

Conclusion

Reviewing the impact of the Iran situation on markets reveals that: oil pricing remains anchored to “supply,” gold to “safe-haven and inflation,” while Bitcoin’s valuation is still at the intersection of macro liquidity and emerging asset narratives. The linkage and divergence among these assets fundamentally reflect different financial properties reacting structurally to the same geopolitical event. For investors, stripping away short-term emotions, distinguishing “facts, opinions, and speculation,” and maintaining a logical framework amid volatility are key.