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PRISM'S CURRENT VIEW
Major headlines: U.S.–Israel military strikes on Iran, Supreme Court invalidates Trump's tariffs, deadlocked Ukraine peace talks.
Iran/Middle East conflict: U.S. and Israel launched "Operation Epic Fury" today, targeting Iranian military and nuclear infrastructure. Iran retaliated against U.S. assets and Gulf energy infrastructure. The Strait of Hormuz (20% of global oil supply) faces disruption. Oil prices expected to surge $10–$20/barrel.
Tariffs: The US Supreme Court struck down Trump's "Liberation Day" tariffs on February 20. Trump invoked Section 122 to impose 10–15% global tariffs expiring in 150 days. Previously negotiated trade deals (EU, Japan) now face legal uncertainty.
Ukraine: Trilateral peace talks (US, Russia, Ukraine) continue with rounds in Abu Dhabi and Geneva. Prisoner swap agreed; territorial and security issues remain deadlocked. Russia shows no urgency. Further talks planned for March.
Critical minerals: China's rare earth export controls remain in force with licensing restrictions on dozens of materials. China published whitelists limiting tungsten, antimony, and silver exporters to 15–44 companies. U.S. and allies accelerating domestic investments; alternative capacity years away.
Oil: Oil prices up ~$11/barrel YTD from conflict premiums. The Strait of Hormuz is the central concern. Gulf producers have spare capacity to offset lost Iranian exports (~1.5–2M barrels/day), but prolonged closure would be significantly disruptive.
Trade deal uncertainty: Supreme Court ruling invalidated IEEPA authority underpinning bilateral deals with 18+ countries. EU delayed ratification; Japan and others face new Section 122 tariffs exceeding negotiated terms. Administration exploring new Section 301/232 investigations, but these take months or years.
RISK DASHBOARD
Economics
Oil prices, already up roughly $11/barrel year-to-date, are expected to spike sharply when markets open Monday following the Iran strikes, with analysts projecting an initial jump of $10–$20/barrel and worst-case scenarios near $100/barrel if the Strait of Hormuz is disrupted. Broader economic uncertainty — driven by tariff volatility, slowing U.S. growth (GDP at 1.4% in Q4), and conflict risk — continues to weigh on global investment and planning.
Oil Prices
Low oil prices remain likely to persist in the near term. However, there are various risks to monitor that threaten to restrict supplies and drive prices higher.
Risk level:
Risk trend:
Moderate
Stable
Global Inflation Outlook
Inflation risk remains stable across most markets, but it has risen in the US and UK.
Risk level:
Risk trend:
Moderate
Increasing
Global Growth Outlook
Global economic risks increased this month, as uncertainty around the trajectory of the US economy increases global impacts.
Risk level:
Risk trend:
Moderate
Stable
HIGHLIGHTED TOPICS
Logistics
The Strait of Hormuz — through which roughly 20% of global oil supply passes daily — is now under direct threat following U.S.-Israeli strikes on Iran, with Iran ordering vessels to halt transit. Separately, Houthi forces have announced a resumption of Red Sea shipping attacks, adding pressure to a second critical maritime corridor.
Critical Infrastructure
Attacks on critical infrastructure have escalated significantlya dn could cause significant risk across supply chains in the future.
Risk level:
Risk trend:
High
Increasing
Maritime Shipping
Risks to maritime shipping remain elevated amid disruptions in the Red Sea, strikes in Europe and continued tensions in the Middle East that could spark disruptions in the Strait of Hormuz.
Risk level:
Risk trend:
High
Increasing
HIGHLIGHTED TOPICS
Materials & inputs
China's rare earth and critical mineral export controls remain in force, with licensing requirements covering dozens of elements, magnets, and battery materials, and new export whitelists further restricting tungsten, antimony, and silver supply. Western governments are accelerating domestic mining and refining investments, but meaningful alternative capacity remains years away.
Artificial Intelligence
AI will be a transformative enterprise technology. But, it comes with near-term cost challenges and ESG risks.
Risk level:
Risk trend:
Low
Declining
Critical Minerals
Risk to critical minerals rose as China's export controls disrupt access to supplies.
Risk level:
Risk trend:
High
Increasing
Semiconductors
Risks to the semiconductor sector increased this month but remained moderate. The top concern is US tariffs on chip imports.
Risk level:
Risk trend:
Moderate
Increasing
HIGHLIGHTED TOPICS
ESG
No major ESG-specific developments this month; geopolitical and trade volatility dominated the agenda, crowding out near-term progress on climate and sustainability policy.
ESG Macro Overview
The pace of ESG progress faces setbacks, forcing a more strategic view on ESG initiatives and creating new compliance risks.
Risk level:
Risk trend:
Moderate
Stable
ESG Transparency & Disclosures
EU transparency rules drive a race to the top that drives costs and reputational risk.
Risk level:
Risk trend:
Moderate
Declining
Carbon Taxes & Import Rules
New EU rules set the stage for significant cost increases from 2026 onward.
Risk level:
Risk trend:
Moderate
Stable
Climate & Net-Zero Policy
Supply chain leaders must prepare for the expanding scope of environmental risks and the potential for sudden policy change.
Risk level:
Risk trend:
Moderate
Stable
HIGHLIGHTED TOPICS
Domestic politics & elections
The U.S. Supreme Court struck down Trump's sweeping IEEPA-based tariffs on February 20, but Trump quickly responded with a new 15% global tariff under Section 122, valid for 150 days. The ruling has thrown previously negotiated bilateral trade deals — including with the EU and Japan — into legal and political uncertainty.
China Decoupling
Risks associated with doing business in China are high, and an EU-China trade war appears increasingly likely.
Risk level:
Risk trend:
High
Stable
US Tariff Policy
The risks of significant disruptions to trade and higher costs increased over the last month. New tariffs are likely across various categories.
Risk level:
Risk trend:
Critical
Stable
HIGHLIGHTED TOPICS
Geopolitics & more
The U.S. and Israel launched large-scale military strikes against Iran today, triggering immediate retaliation and threatening to disrupt the Strait of Hormuz — the world's most critical oil chokepoint. Ukraine peace talks continued in Abu Dhabi and Geneva but remain deadlocked over territorial demands, with no ceasefire in sight.
China Decoupling
Risks associated with doing business in China are high, and an EU-China trade war appears increasingly likely.
Risk level:
Risk trend:
High
Stable
Middle East Conflict
Risk rose sharply after the US launched strikes on Iran on June 22. There remains a significant risk of continued instability in the region.
Risk level:
Risk trend:
High
Increasing
Ukraine War
Militarily at a stalemate, but with a change in US policy toward Ukraine, the outlook is more uncertain than ever.
Risk level:
Risk trend:
Moderate
Stable