Nicole Lapin

and Israel to absorb quietly.

Oxford Economics research arm put it bluntly.

The conflict is unlikely to last beyond two months, but the near-term volatility will be severe.

And the markets, they are already feeling the volatility.

And the fact that markets are closed on the weekends may have been in part why the strikes happened the way they did.

Venezuelan President Maduro was also captured when the markets were closed on Saturday, January 3rd.

Here's how this conflict will reach your wallet.

The most immediate consequence will be oil prices.

U.S.

crude oil surged more than 7% on Monday.

Brent crude, the international oil benchmark, jumped nearly 9% to hit nearly $80 a barrel.

That's the highest price it's been in over a year.

And oil had already climbed 17% this year before the strikes even started.

Traders saw the U.S.

military buildup and thought something like this would be coming.

Let me break down the basic economics behind the trade.

Oil is a global commodity and its price is driven by supply and demand.

When a conflict breaks out in the Middle East, traders immediately start pricing in risk that supply could be disrupted.

It doesn't matter if a single barrel has actually been taken off the market yet.

The fear of disruption is enough to send prices higher because markets trade on expectations.