THE escalation of tensions in the Middle East is adding volatility to global energy markets, and financial markets are beginning to price in the uncertainty this may create for inflation and interest rates.

Brent crude prices have risen roughly 40–50% since the first days of the conflict, while investors are reassessing risk across global markets.

At the same time, the 12-month Euribor — the benchmark index used for most mortgages in Spain — has edged up to around 2,552%, its highest level in nearly three months. 

However, analysts note that the Euribor had already begun to move slightly higher before the latest geopolitical developments, meaning it is still too early to attribute changes in mortgage pricing directly to the conflict. 

READ MORE: Spain’s newest property hotspot: The Gibraltar treaty is causing a gold rush in La Linea as the border prepares to come down

For now, the main impact appears to be greater uncertainty in financial markets, rather than a structural shift in Spain’s mortgage environment. 

‘In moments like this, the mortgage story isn’t necessarily the headline rate,’ says Mortgage Direct, which specialises in financing international property buyers in Spain.

‘It’s the level of uncertainty around how markets might move if geopolitical tensions persist.’

READ MORE: Spain’s property market continues to heat up: The eight provinces where home sales now exceed bubble-era highs

How geopolitical uncertainty reaches mortgage markets 

Geopolitical tensions tend to affect mortgage markets indirectly through financial markets. 

When energy prices rise, investors reassess the outlook for inflation and interest rates.

That process can influence benchmark indices such as the Euribor, which Spanish banks use as a reference when pricing many mortgage products. 

READ MORE: How did two Germans come to build a tourist flat empire spanning thousands of properties across Spain in the middle of a housing crisis?

At this stage, the movements in Euribor remain relatively modest and do not yet point to a major shift in borrowing conditions.

However, periods of uncertainty can lead lenders to monitor market developments more closely and adjust pricing more frequently if volatility increases. 

‘The biggest impact at the moment is uncertainty rather than a clear change in market fundamentals,’ Mortgage Direct explains. ‘Lenders are watching the situation, but it’s too early to say whether this will translate into meaningful changes in mortgage rates.’ 

READ MORE: Energy shock fears mount after Iranian attack on vital Qatar plant sends gas prices soaring by 25%

Spain’s broader position remains stable 

Despite global volatility, Spain’s economic and energy position provides some resilience. 

The 12-month Euribor averaged around 2.22% in February 2026, meaning mortgage pricing remains in the low-2% range by historical standards.

Spain also has the largest liquefied natural gas regasification capacity in Europe, which helps reduce concerns about physical supply disruptions even when energy prices fluctuate. 

That distinction matters because the current situation is primarily about price volatility rather than supply shortages, unlike the energy shock that followed the outbreak of war in Ukraine in 2022. 

READ MORE: Forget about that summer holiday? European jet fuel prices DOUBLE as airlines start raising prices and cancelling routes

Demand from international property buyers has also remained relatively stable, according to activity observed by lenders and brokers working with foreign buyers. 

A market shaped by uncertainty 

For buyers considering property in Spain, the key factor in the coming months may be how geopolitical developments influence broader financial markets. 

Mortgage pricing depends not only on Euribor movements but also on exchange rates, inflation expectations and overall market sentiment.

These factors can shift as investors reassess economic risks. 

READ MORE: UK Chancellor Rachel Reeves rolls into Madrid to sign series of deals including €20bn investment plan

For buyers already considering property in Spain, periods of market uncertainty can also create moments of opportunity.

When financial markets become more volatile, some buyers choose to move forward with financing discussions earlier in the process so they better understand the conditions available to them.

Having clarity on borrowing options can make it easier to move quickly if the right property appears. 

READ MORE: British tourists make up over half of Benidorm’s hotel bookings in something ‘not seen for a long time’

In practice, many international buyers use this stage to explore mortgage options and obtain an initial view from lenders before beginning their property search. 

For now, lenders and borrowers alike are primarily watching how global markets respond to the evolving geopolitical situation. 

‘The situation is still developing,’ Mortgage Direct notes. ‘At this stage, it’s less about immediate changes in mortgage rates and more about how uncertainty in global markets could influence borrowing conditions over time.’

Click here to read more Other News from The Olive Press.