UNDERSTANDING ENERGY-FINANCIAL MARKET INTERCONNECTIONS IN ASIA AMID THE US-ISRAEL-IRAN CONFLICT: A DESCRIPTIVE AND RISK-BASED ANALYSIS

Taiwo  A. Muritala

doi:10.57233/gujaf.v7i1.25

Authors

Taiwo A. Muritala Department of Accounting Science Faculty of Economic and Financial Sciences Walter Sisulu University, Mthatha, Private Bag X1, UNITRA, 5117, South Africa.

DOI:

https://doi.org/10.57233/gujaf.v7i1.25

Keywords:

Spillover Effects, Energy Markets, Asian Financial Markets, Geopolitical Risk, Market Volatility, Systemic Risk

Abstract

This study investigates the spillover effects between energy markets and Asian financial markets during the US-Israel conflict with Iran. Using simulated data and descriptive analyses, the research examines volatility transmission, correlations, and market interconnections across crude oil, natural gas, clean energy, and major Asian stock indices. The results indicate that energy market shocks rapidly transmit to financial markets, with varying intensity across different countries and sectors. Correlation analyses and heatmaps reveal strong linkages, highlighting the systemic vulnerability of Asian markets to geopolitical crises. The study underscores the importance of proactive monitoring, strategic energy planning, and financial risk management to mitigate the adverse impacts of energy-related shocks. By providing descriptive insights into market interconnectedness, the study offers a foundation for policymakers and investors to design strategies for market stability during extreme geopolitical events.