Bloomberg Economics and JP Morgan Forecasts
Strait of Hormuz Handles 20% of Global Oil Supply
On the 21st (local time), as the United States directly struck three major nuclear facilities in Iran, there are projections that international oil prices could soar to as high as $130 per barrel. Analysts suggest that if Iran launches a military response against the United States, oil prices, which are currently in the mid-$70 range, could nearly double.
Bloomberg Economics (BE) presented three scenarios in which Iran could respond to the U.S. attack: attacks on U.S. troops and assets in the Middle East; attacks on energy infrastructure in the Middle East; and the closure of the Strait of Hormuz.
Among these, Bloomberg Economics identified the worst-case scenario as the closure of the Strait of Hormuz, the main oil transport route in the Middle East, in which case oil prices could surpass $130 per barrel. The Strait of Hormuz handles about one-fifth of the world’s daily oil supply. If Iran were to block the strait or attack oil tankers passing through it, oil prices could skyrocket to catastrophic levels.
JP Morgan also analyzed in a recent report that if Iran closes the Strait of Hormuz and the conflict spreads throughout the Middle East, oil prices could surge to $120?$130 per barrel, reaching levels seen at the outbreak of the Ukraine war in 2022. Oxford Economics likewise projected that in the worst-case scenario, oil prices could rise to $130 per barrel.
If oil prices surge, it is expected that inflation, which has recently stabilized, will spike again.
Bloomberg Economics predicted that if the closure of the Strait of Hormuz becomes a reality, the U.S. Consumer Price Index (CPI) inflation rate could approach 4% during the summer.
Oxford Economics analyzed, "In the most severe case, if international oil prices soar to $130 per barrel, the U.S. inflation rate could reach 6% by the end of the year."
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