Catenaa, Friday, March 13, 2026- The rise in oil prices and growing concerns around private credit are causing market activity to resemble the lead-up to the 2008 global financial crisis, Bank of America said.
BofA strategist Michael Hartnett flagged how oil doubled to $140 a barrel by August 2008 from $70 in July 2007, coinciding with the start of the “subprime tremors” that engulfed the likes of Northern Rock and Bear Stearns.
The war in Iran that erupted on February 28 has pushed oil prices more than 60% higher this year.
“Asset performance in 2026 is more ominously close to price action seen from mid’07 to mid’08,” Hartnett said in a note. Wall Street is “ominously trading ‘07-’08 analog,” he added.
Concerns are rising about banks’ exposure to private credit, an asset class grappling with fund redemptions, scrutiny of underwriting standards, and the impact of artificial intelligence on some borrowers.
At the same time, soaring energy costs from the war in Iran are fueling fears of stagflation, where rising price pressures force central banks to raise interest rates as economic growth stalls.
For the moment, the market consensus is that a conflict in Iran won’t be long and that the issues in private credit aren’t systemic, according to Hartnett.
This is encouraging continued bullish positioning as investors bank on their view that “policymakers always ride to Wall Street rescue.”
The bigger risk to stocks from climbing oil prices and tightening financial conditions lies in earnings, rather than inflation, according to Hartnett.
