Impacts of the Iran War on Cash Management

Impact of the Iran War on Cash Management

The current escalation in the Middle East highlights security policy risks, potential disruptions in global supply chains, and rising energy prices in the focus of financial markets. For companies, this results in immediate implications for liquidity management and risk management.

Increasing Inflation Risks

About 20% of the world's oil shipments are transported daily through the Strait of Hormuz. The Gulf states also produce approximately 17–20% of the global natural gas supply. Consequently, the commodity markets react sensitively to geopolitical tensions.

The oil price (Brent) has increased by about 35% since the beginning of the year; the recent escalation alone led to a rise of nearly 20% within a few days. Rising energy prices and potential supply chain disruptions increase inflationary pressure.

After the inflation rate in Germany was within the target range of the European Central Bank (ECB) in February 2026 at 1.9%, persistently high energy prices could again significantly increase the inflation rate. Today's published inflation data for the eurozone already exceed expectations at 1.9%.

Capital Markets and Interest Rate Developments

ECB Chief Economist Philip Lane recently pointed out the risk that a prolonged conflict in the Middle East could lead to a combination of weaker economic growth and higher inflation, a stagflationary environment.

If elevated inflation expectations solidify or monetary tightening becomes necessary, this could also lead to rising yields in the money and bond markets. For companies, a higher interest rate environment with simultaneously higher inflation generally means a greater depreciation of liquid assets, especially if these are held in low-interest bank accounts. Therefore, classical bank accounts are less suitable for optimal liquidity management in times of crisis. At UnitPlus Business, companies directly participate in rising money market interest rates as part of their liquidity management. In an environment of higher key interest rates, the return potential on non-operational liquid assets also increases accordingly.

Security and Diversification in Times of Crisis

In periods of increased systemic risk, it is regularly observed that market participants withdraw funds from traditional bank deposits and diversify more broadly. Capital flows into money market and bond products increase, particularly when there is uncertainty about the stability of individual financial institutions or entire systems.

The underlying motive is the legal and economic separation of assets from the balance sheet risk of individual banks. This principle is also the basis of UnitPlus Business, which protects funds as special assets from bank insolvencies beyond the deposit insurance.

Conclusion: Stability as a Basis for Sustainable Corporate Governance

The duration and further development of the Iran war are currently difficult to foresee. Therefore, it is all the more important to have a structured and resilient cash management system. A clear liquidity strategy and access to market-based returns on non-essential funds contribute to securing operational stability and maintaining corporate capabilities even in economically challenging market phases.