Capstone investments – April 15 2026
By Bryce Pease CFP® Accredited Investment Fiduciary® Casey Morris CFP® Capstone Pacific Investment Strategies, Inc. California, Colorado, Nebraska
I’m writing this Monday morning and things are probably going to be different by the time you read this.
Geopolitical conflicts tend to have a short-lived effect on the markets. But sometimes, conflicts can lead to economic disruption. When that happens, investors must contend with major uncertainty…and uncertainty means volatility. This is what we’re seeing now due to the ongoing war in Iran and the near-total closure of the Strait of Hormuz. Disruption, uncertainty, and volatility.
Here’s the situation in a nutshell: 20% of the world’s oil flows through the Strait.1 With only a few tankers passing through over the last few weeks, the world is facing the single largest supply disruption in history, made worse by the fact that Iran has also struck nearby oil and gas facilities across the Persian Gulf. Due to this, the price of oil has risen to over $100 a barrel, with Brent crude, the global benchmark, rising to over $113. Oil, as you know, is the blood that powers the world economy. Furthermore, it’s not just oil that passes through the Strait. In fact, up to 20% of the world’s natural gas and 30% of its fertilizer transported by ship must first transit the Strait before reaching the wider ocean.
Take a moment to visualize what this looks like. Three products, oil, gas, and fertilizer, all choked off in one of the world’s most important pipelines. Over the coming weeks, ships that have already left the Strait will finish delivering what supplies they have, but after that, shortages may begin.
Now, the United States does not heavily rely on oil and gas passing through the Strait, as we have our own supply of both. Natural gas is a critical part of producing fertilizer; fertilizer is a critical part of growing food. Both gas and oil are used to produce plastic, which is used to contain nearly everything that gets shipped from one place to another. Shipping, of course, requires oil.
One rate that has jumped in recent weeks is that of the 10-year Treasury Note.3 This interest rate – which is essentially the rate at which the government borrows from investors for a term of 10 years – influences mortgage rates, credit cards, and other types of loans. The fact that it’s on the rise may be the market’s way of saying that investors expect interest rates in general to rise, too.
All of this injects significant uncertainty into the markets. Which is probably why the Dow, the S&P 500, and the Nasdaq are all in “market correction” territory.4 (A correction, remember, is a drop of 10% or more from a recent high.)
We don’t yet know exactly whether and how much inflation will go up, or for how long, or what that will mean for interest rates over the long-term. We certainly can’t predict what the markets will do. Corrections are common, and it’s possible the war could end as quickly as it started.
This situation may have major ramifications for the global economy. And even if the war were to end tomorrow, that doesn’t guarantee everything will go back to normal overnight. Oil prices alone may remain elevated for some time. (There’s a saying among economists that oil prices rise like a rocket and fall like a feather.)
Casey and Bryce
www.capstonepacificinc.com
Phone- 402-207-5383
Or 626-915-7006
1”A new oil shock is building,” CNBC, https://www.cnbc.com/2026/03/28/oil-gas-prices-iran-war-hormuz.html
2 “It’s not just oil. Here comes Hormuz inflation.” Politico. https://www.politico.com/news/2026/03/14/hormuz-inflation-helium-fertilizer-00828680
3 “Treasury yields rise as Iran ceasefire optimism fades,” CNBC, https://www.cnbc.com/2026/03/26/treasury-yields-rise-uncertainty-ceasefire-talks.html
4 “Dow closes in correction,” CNN, https://cnn.com/2026/03/27/investing/us-stocks-iran
Any securities mentioned in this article are not a recommendation to buy, sell or hold. The opinions presented cannot be viewed as an indicator of future performance.