The implications of the ongoing attacks on Iran by the United States-backed Israel on the peso–dollar exchange rate and the Philippine economy as a whole remain hanging, according to RCBC Chief Economist Michael Ricafort.

But as early as Friday (US time), crude oil prices already escalated because of worries about a possible US attack on Iran, spiking more than three percent.

That same day, Wall Street stocks were sliding amid anxiety over artificial intelligence and data showing an uptick in US inflation.

In an interview with DAILY TRIBUNE, Ricafort on Sunday, said the effects of the ongoing conflict are “still wait-and-see for the markets upon resumption of trading on Monday, 2 March, especially if there would be volatility in global oil/energy prices and potential disruption of global oil/energy supply chains,” noting that demand for the greenback may rise amid bargain-hunting and hedging.

“We’ll see by tomorrow when the markets reopen, but there could be some bargain-hunting to hedge requirements as a matter of prudence, until the dust settles,” Ricafort added.

During the January Venezuelan invasion by the US, the peso weakened slightly against the US dollar once markets reopened.

Before the event, the peso had been trading just under the P59 level. However, in the first trading sessions after the news, it slipped to around P59.13–P59.21 per dollar, moving closer to its recent lows.

The depreciation reflected not a collapse but rather a modest reaction driven mainly by investors shifting toward the US dollar as a safe-haven asset amid geopolitical uncertainty following the strike — something Ricafort said could happen again following the US strikes on Iran, which reportedly resulted in the death of Iranian Supreme Leader Ali Khamenei.

“There could be some shift to safe havens until the dust settles, as a matter of prudence to hedge various risk exposures to be on the safe side,” he said.

Hormuz Strait shuts down

Meanwhile, the closure of the Strait of Hormuz remains a major risk for global oil prices, as it is a key shipping route connecting the oil-producing countries of the Middle East to the rest of the world.

Approximately 20 million barrels of crude oil passed through the strait daily in 2024, equivalent to nearly 20 percent of global oil consumption, according to the US Energy Information Administration.