Oil prices are rising sharply as geopolitical risk intensifies across the Gulf, but investors focusing only on short-term price spikes may be missing a deeper and more structural shift in global markets.
Brent crude climbed 4% to $103.78 following renewed attacks on energy infrastructure, as Iran escalated activity across the region. While prices remain below the $119.50 peak reached earlier in the conflict, they are still nearly 50% higher than pre-war levels—signaling sustained pressure in the global energy market.
Recent developments highlight a critical change in risk dynamics. The UAE confirmed that a drone struck the Shah gas field—one of the largest in the world—while a tanker was hit near Fujairah in the Gulf of Oman.
According to Nigel Green, CEO of deVere Group, this marks a turning point in how markets must assess geopolitical risk.
“Billion-dollar facilities and vital shipping routes are increasingly exposed to attacks that require minimal capital and limited sophistication.
Cheap drone capability is introducing a permanent layer of risk into the global energy system.”
This shift represents a fundamental change in market structure.
Traditionally, energy markets priced disruption based on state-level conflict, sanctions, or coordinated supply decisions. Today, the barrier to disruption has collapsed. Non-state actors and regional proxies can now target critical infrastructure with relatively low-cost technology, increasing the frequency and unpredictability of supply shocks.
“A single drone costing a few thousand dollars can disrupt assets worth billions. This changes how risk needs to be priced across energy markets and beyond,” Green explains.
For investors, the implications are significant.
First, energy market volatility is becoming structural.Short-term price spikes are likely to occur more frequently, but more importantly, the baseline for oil prices may rise as markets begin to factor in a permanent geopolitical risk premium.
Second, capital allocation is shifting.
Companies with diversified assets, stronger security infrastructure, and operational resilience are expected to command higher valuations as investors prioritize stability.
Third, adjacent sectors are gaining momentum.
Defence and counter-drone technology firms are positioned for increased demand as governments and corporations invest in protecting energy infrastructure and supply chains.
“This is no longer just about oil. It directly impacts defence spending, technology investment, and global supply chain resilience,” Green notes.
Currency markets are also reacting to the changing landscape.
Energy-importing nations may face renewed pressure on their currencies, while safe-haven assets—particularly the US dollar—are likely to attract inflows during periods of escalation.
Importantly, this is not a temporary phenomenon tied to a single conflict.
The rapid global proliferation of drone technology—combined with falling costs and proven tactical effectiveness—is reshaping how risk is distributed across markets.
“Markets have yet to fully absorb what this means for long-term pricing,” warns Green.
He concludes: “The rules have changed. Risk is being democratized, and markets will have to catch up.”
