TAG Industrial Watch: March 7, 2026

Although the outbreak of war is halfway around the world in the Middle East, the effects are hitting home for U.S. industrial investors, creating challenges and opportunities in the process. TAG has long encouraged clients to invest in oil-dependent markets such as Midland/Odessa, Houston, and Beaumont. With oil prices already up over 50% year-to-date, investors in oil markets stand to benefit if prices remain elevated, as higher prices incentivize oil-related companies to expand production and services, effectively increasing demand for industrial space. On the flip side, industrial investors may have to contend with steadily rising interest rates, which dampen investment demand. During the outbreak of past wars involving the U.S., interest rates on Treasuries would typically fall as “safe haven” demand spiked. However, Treasuries have been losing their global appeal in recent years. Consequently, the rate on the commonly cited 10-Year Treasury rose roughly 18 basis points over the last week as the war unfolded. Thus far, the U.S. Dollar Index has experienced a sustained bump (indicating some safe haven flight to dollars), but if the dollar’s exchange value begins to reflect the souring demand for Treasuries, a decline in the dollar will only add to oil’s upward pressure on prices.