Gas prices rise and stocks sink as the U.S. war with Iran intensifies. Here's what to know

War is spreading in the Middle East after the U.S.'s shocking weekend series of attacks on Iran — and markets are reacting in real time to the new geopolitical risks spreading across stocks and energy, as well as billions in threatened AI investments closer to home.

Here's a recap of the biggest trends as of Tuesday.

Oil is the biggest story

Brent crude is now trading north of $83 a barrel, up from roughly $73 at the beginning of February — a 14% jump in just one month. As of Tuesday morning, oil futures are soaring across the world, and prices could balloon further as Iran's Strait of Hormuz, the chokepoint of international trade, remains closed.

For consumers, pump prices are already rising. The national average of a gallon of gas has jumped from $2.99 to $3.11, even as regional prices vary. Analysts warn that prices have the potential to climb another 30-50 cents within days.

As usual when an energy crisis looms, airline stocks are among the hardest hits. The logic is simple: Fuel costs typically represent about 30% of airlines’ operating expenses, and now, with airspace closures forcing reroutes and mass cancellations, investors aren't waiting around to see what happens. As of this writing, American Airlines is already down 5.5%, while United has likewise dropped 5.5%. Industry ETFs have declined about 5%.

Global stocks are cratering

U.S. stocks are taking a hit, with the Nasdaq $NDAQ dropping 2.2% and the S&P declining over 2% at Tuesday’s open. Partially explaining the drop? President Donald Trump's comment that the U.S. could fight “forever” has landed about as well as you'd expect with investors hoping for a quick resolution and limited disruption.

But U.S. stocks aren’t the only stocks dropping. Global markets are also seeing their largest declines in months, with South Korea leading the carnage with an 8% drop, Japan down 6% and Germany sinking 5%. The U.K. and Italy fell around 4%, while France dropped 3%. Even China, which has its own complicated relationship with the Middle East and energy markets, slid about 2%.

Accelerating Europe's and Asia's decoupling from the U.S.

Underneath the noisy stock moves, there's a longer-term slower-moving phenomenon that the conflict seems to be, if anything, accelerating. Last week, European Central Bank chief Christine Lagarde gave a speech in which she argued that Europe needs to redirect its excess capital inside its own borders, rather than looking to U.S. investments.

At the same time, Japan's rising yields are also reducing the incentive to send capital abroad; the country is no longer the top lender to the world. China has made its own moves to keep more capital at home, too. The flows of global funds that have made the U.S.'s markets the deepest in the world are beginning to reverse.

A surprise and prolonged war — leaped into with little rationale, after decades of U.S. adventurism in the Middle East has underlined the importance of succession plans if nothing else — is hardly likely to slow down the trend of Europe and Asian economies decoupling from the U.S. In fact, it’s far likelier to accelerate it.