Capital management giant Apollo: Oil price surge after Iran conflict may worsen impact of US stagflation.

Apollo Global Management pointed out that after Israel launched attacks on Iran, oil prices surged. If this trend continues, it may worsen the stagnation situation in the United States. Last week, Israel launched airstrikes on Iran without US support, causing severe market volatility. This led to a sharp increase in crude oil futures prices, a surge in gold futures, and a sharp drop in US stock futures and Asia-Pacific stock markets. Last Friday, the price of crude oil rose by over 7% in a single day, marking the largest daily increase in three years. Torsten Slock, Chief Economist of Apollo Global Management, stated: "According to the US Federal Reserve's economic model, a continuous increase in oil prices by $10 is expected to push inflation up by 0.4% (including secondary effects) and cause GDP to decrease by 0.4%." Currently, West Texas Intermediate (WTI) crude oil has risen by over $10 from its low point at the end of May. He further pointed out: "Tariffs will also increase inflation and suppress GDP growth, while immigration restrictions will exacerbate wage inflation and drag down employment growth. In short, high oil prices exacerbate the persistent stagnation impact caused by tariffs and immigration restrictions." This week, the market expects Federal Reserve Chairman Jerome Powell and his colleagues to maintain the benchmark interest rate at the June 17-18 meeting. As of last Friday, trading prices indicated an 80% probability of a rate cut by the Federal Reserve in September. Slock said: "Stagnation will be a thorny issue at the Federal Open Market Committee (FOMC) meeting - upward inflation pressures suggest the Federal Reserve should raise rates, while slowing GDP growth points to a rate cut. So, will the Federal Reserve FOMC meeting focus more on the upward pressure on inflation or the impending slowdown in growth?"