West Texas Intermediate crude futures spiked as high as $111 a barrel on Sunday evening as the deepening Middle East conflict sent panic through oil markets, with supplies from key Gulf producers going offline and the Strait of Hormuz remaining paralyzed into week two.

The key question on some energy desks is whether this energy shock will force President Trump to scale back Operation Epic Fury in a TACO-style retreat by Tuesday with WTI in triple-digit territory. That is hard to say, given that U.S. Central Command stated on X over the weekend that the operation will only accelerate from here.

But BofA's Michael Hartnett suggests a de-escalation of the Iran war in March (read the note). That's because Trump's approval ratings for the economy (40%) and inflation (36%) are back at their lows.

The larger concern now, beyond the energy market, is the risk of a global spillover. As Jared Cohen, President of Global Affairs and Co-Head of the Goldman Sachs Global Institute, warned investors on the GS Weekend Macro Call, the Islamic Revolutionary Guard Corps maintains cells across multiple emerging market countries and could begin activating them.

"What I am looking for next is that they have meaningful cells in the Tri-Border Area of Latin America, West Africa, and elsewhere. They could hit an embassy, they could hit a consulate, or they could hit a cultural center in any one of the twelve countries they have already attacked," Cohen explained. 

He continued, "They could do something in Europe. They could carry out a meaningful cyberattack. Right now, in the Strait of Hormuz, they have essentially blocked it by driving up insurance costs. They could still mine it. And the Houthis have not done anything yet in the Red Sea. You could also see something involving undersea cables, where 80% of Europe-Asia internet traffic flows."

"So that's kind of what I'm watching for," Cohen told clients. However, he didn't mention in that thought of whether terror fallouts would wash up on the shores of the U.S. Homeland, given the illegal alien invasion by the Democrats under the Biden-Harris administration. 

The U.S. Homeland has already had a few wakeup calls:

While JPMorgan analysts are closely watching the risk of Gulf oil shut-ins exceeding 4 million barrels per day by the end of next week, Cohen's role at Goldman is to focus on geopolitical risk, and anyone who heard his webinar this weekend would come away with the view that spillover risks ex-Middle East could soon be a major risk.