Investors anticipate Trump and Iran acting on Hormuz threats that could lead to catastrophic outcomes

(SeaPRwire) –   Wall Street is preparing for a Monday deadline issued by President Donald Trump, who has demanded that Iran reopen the Strait of Hormuz, all while the global economy continues to struggle under the weight of an ongoing energy crisis.

Futures for the Dow Jones Industrial Average declined by 78 points, or 0.17%. Meanwhile, S&P 500 futures dropped 0.25%, and Nasdaq futures saw a decrease of 0.32%.

U.S. oil futures fell 0.12% to $98.11 per barrel, and Brent crude dropped 0.38% to $111.76. According to AAA, the national average price for gasoline hit $3.94 per gallon on Sunday, marking an increase of over $1 within the last month.

The yield on the 10-year Treasury note climbed 1.7 basis points to 4.409%. The U.S. dollar saw a 0.1% gain against the euro and remained steady against the yen.

On Saturday evening, President Trump gave Tehran a 48-hour window to meet his demands, threatening the destruction of power plants and signaling a potential expansion of the conflict to include civilian infrastructure.

In response to the ultimatum, Iran warned that any such strike would lead its forces to retaliate against critical infrastructure, specifically targeting desalination plants that serve as a primary source of fresh water for the region.

David Sacks, the president’s AI and crypto advisor, previously expressed concerns regarding this escalation trajectory, urging the administration to declare victory and withdraw from Iran.

“If you see that type of destruction continue, you could literally render the Gulf almost uninhabitable,” Sacks stated during a March 13 episode of the All-In podcast. “I mean you’re not going to have enough water for 100 million people, and human beings just cannot survive very long without water. So that would be a truly catastrophic scenario, and we’re talking about destroying the Gulf states economically and then also from a humanitarian perspective.”

With neither side showing a willingness to retreat, military posturing has intensified. Trump is deploying three additional amphibious assault ships and 2,500 Marines to the Middle East, supplementing a Marine Expeditionary Unit already in transit. These forces join the more than 50,000 U.S. troops currently stationed in the region.

Separately, Iran conducted a ballistic missile strike against a U.S.-U.K. base on Diego Garcia in the Indian Ocean. Although the attack failed to hit its target, it revealed that Iranian missile capabilities possess a greater range than previously estimated, theoretically placing much of Europe within reach.

On Sunday, NATO Secretary General Mark Rutte expressed support for the conflict, predicting that the alliance would eventually align with the U.S. position, despite initial resistance from members regarding Trump’s request for naval escorts.

“If Iran would have the nuclear capability, including, together with the missile capability, it will be a direct threat, a existential threat, to Israel, to the region, to Europe, to the stability in the world,” Rutte told CBS News. “So the president doing this is crucial, and I’ve seen the polling, but I really hope the American people will be with him, because he is doing this to make the whole world safer.”

The United Arab Emirates, having faced repeated missile and drone attacks from Iran, has also signaled support for the U.S. approach.

Anwar Gargash, a senior UAE diplomat, indicated a shift toward a more rigid policy against Iran that mirrors the strategies of the U.S. and Israel.

“Our thinking does not stop at a ceasefire, but rather turns toward solutions that ensure lasting security in the Arabian Gulf, curbing the nuclear threat, missiles, drones, and the bullying of the straits,” Gargash wrote on X. “It is inconceivable that this aggression should turn into a permanent state of threat.”

In the absence of diplomatic efforts to resolve the standoff, the thousands of Marines deploying to the region may be tasked with a decisive operation to secure the Strait of Hormuz and neutralize Iran’s ability to disrupt it.

Others have advocated for alternative strategies, such as a naval blockade of Iranian oil exports to pressure the regime into reopening the waterway.

“The US can implode Iran’s economy by shutting down its oil exports,” Robin Brooks, a senior fellow at the Brookings Institution, wrote in a March 13 Substack post. “That might open up the Strait of Hormuz a lot faster than anything else. Time to implode Iran’s economy and give the Ayatollahs a taste of their own medicine.”