Economist William Jackson has warned that ongoing tensions in Iran could push Brent crude oil prices to around $80 per barrel, even if the conflict is contained. This price level was last seen during a 12-day escalation with Iran in June of the previous year. Jackson cautioned that if the conflict continues to disrupt oil supply, prices could surge to $100 per barrel, potentially increasing global inflation by 0.6 to 0.7 percentage points. In a more severe scenario, if the Strait of Hormuz is completely closed for two to four weeks, Goldman Sachs and JP Morgan have projected oil prices could reach between $150 and $200 per barrel. Such a situation could trigger a severe global energy crisis, pushing major economies toward stagflation or recession. Historically, the late 1970s oil crisis caused oil prices to rise by over 200%, leading several economies, including the United States, into recession. Rising crude oil prices significantly impact the global economy by increasing production costs, which in turn raises consumer goods and service prices. Iran, as a key oil exporter in the Persian Gulf, contributes to regional tensions that create uncertainty in global energy markets. Disruptions in oil supply could lead to sharp increases in energy costs worldwide, negatively affecting the global economy. This risk poses challenges for global markets, urging investors to exercise caution and compelling governments to seek alternative energy sources and develop strategies to stabilize prices.
Source: binance
