Gate News reports that on March 20, Wellington Management’s Portfolio Manager Brijesh Kurana stated that after the U.S.-Israel attack on Iran, rising crude oil prices led to increased global oil import costs, while most major economies’ currencies against the U.S. dollar were affected. This double impact creates a situation where, as the dollar strengthens and oil prices soar, foreign countries and companies may have to sell their holdings of U.S. stocks and bonds to pay for the suddenly more expensive oil. Kurana pointed out that so far, foreign investors do not need to liquidate U.S. assets to finance higher energy costs. However, if oil prices remain high, countries like Japan and South Korea may need to reduce their holdings of U.S. stocks and bonds to fund energy imports. This risk warrants attention, especially given the increasing share of U.S. market holdings by foreign governments and entities.
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