And while it may seem very far away, there are a number of Aussie industries set to be impacted by the global crisis.
That’s why Yahoo Finance asked the experts for their predictions on which industries will do well and which are set to suffer.
Here’s what they had to say.
Sectors set to succeed
The oil market is expected to see significant impact, which isn't necessarily a bad thing.
While prices may rise at the petrol pump, oil companies may see rising profits, Josh Gilbert, eToro’s Australian market analyst, said.
“The most significant impact that this conflict could have is on commodities like oil,” he said.
“The oil price is currently just shy of US$100 a barrel, and the strained relationship between Russia and Ukraine may cause it to rise above this level for the first time since 2014, given Russia’s significant role in the oil industry.
“With prices already surging this year, oil stocks have reaped the rewards.”
BP and Royal Dutch Shell have both reported large profits in their most recent earnings reports, Gilbert pointed out.
“In general, commodities are often considered a safe-haven asset, and these tensions will likely see prices continue to climb.”
And, it’s not just the oil market that is expected to see a boost.
“Gas and energy players such as Woodside Petroleum (ASX: WPL), Santos (ASX: STO) and Beach Energy (ASX: BPT) will benefit from the rise in oil and gas prices,” Evan Lucas, chief market strategist at InvestSmart, told Yahoo Finance.
“In 2014, and previous conflicts such as this, these players have benefited. The caveat is that the rise in oil can fall just as fast if the conflict eases and can see them giving up gains as fast as they were made.”
Investors will often flock to the safe haven of gold during a crisis, market analyst at IG Kyle Rodda said.
“The risk of sanctions and flight to alternative stores of value has fuelled gold, which is forming a
short-term uptrend now,” he said.
“Sanctions mean the effective locking out of Russia from the global financial system, as well as SWIFT – the global payments system – rendering some currency reserves obsolete.”
Gold is one of the few assets investors can rely on in times of uncertainty. While the price of gold may fluctuate, there is a physical asset to back it up - which is why investors gravitate towards it.
The major technology players are solid businesses with a significant amount of money to hold themselves up. In addition, they’re not really exposed to global crises, Gilbert said.
“Big Tech companies have also stood up as a new defence in times of uncertainty,” Gilbert said.
“Companies like Apple, Microsoft and Amazon have dominant market positions, strong growth, high margins, and fortress balance sheets.
“They are all-weather equities that appear to be able to deal with uncertainty.”
Sectors in danger
1. Travel, aviation and infrastructure
Why all three together? Because they all rely on oil and, while an increase in the oil price will benefit the producers, it may have harmful effects to the industries that rely on getting it, Lucas said.
“Fuel increases lead to cost blow-outs and lower margins as businesses tend to absorb the cost,” he said.
“Aviation has the double hit of people slowing their travel and holiday movements during these periods - although COVID is clearly a major issue here too.”
Lucas said consumers were likely to slow their movements, with fuel costs leading to low road usage.
2. Companies exposed to Russia
Gilbert said companies which get a large portion of their revenue from the Russian market will likely see a hit.
“This includes the likes of Philip Morris International (whose revenue from Russia accounts for 8 per cent of its total revenue), Pepsi (4.4 per cent revenue exposure) and McDonald's (4.2 per cent revenue exposure),” he said.
“While investors have a lot to consider right now, it’s crucial that they remember to keep up to date with the news, retain a long-term investment strategy, and not panic in situations where volatility is high.”