economy
March 9, 2026
Three bear markets in stocks were caused by oil shocks
As the fallout in the oil markets from the U.S.-Iran war continues, here’s what severe oil shocks have done to the S&P 500 in the past.
TL;DR
- U.S. oil prices exceeding $100 per barrel are raising concerns about a potential market correction or bear market.
- Three of the last eighteen S&P 500 bear markets were caused by oil shocks, with an average duration of 13 months and a decline of nearly 30%.
- Notable oil shocks include the 1973 OPEC embargo, the 1956 Suez Canal crisis, and the 1990 invasion of Kuwait, all of which impacted oil prices and contributed to economic difficulties.
- Higher oil prices can negatively affect consumers by reducing non-essential spending and can lead to inflation, higher interest rates, and decreased loan demand.
- The current U.S.-Iran war has seen oil prices jump over 50%, while the S&P 500 has fallen just over 2%.
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