Energy analysts are raising alarms about where oil prices could go if the Iran war extends through the summer, with some projections now pointing to territory the market has never seen. Strategists at Macquarie Group warned this week that if the conflict persists through the end of June, crude prices may need to climb above $200 per barrel to reduce global demand enough to rebalance a market that has already lost access to roughly a fifth of the world’s oil supply. At that level, American drivers could be paying close to $7 per gallon at the pump.
Macquarie’s team placed the probability of that scenario at around 40 percent, meaning it is a serious risk rather than a fringe outcome. The more likely path, in their assessment, is one where the war concludes by early April, prices begin to ease and the global economy absorbs a relatively modest hit. But that window is narrowing, and each passing week without a resolution shifts the odds.
Brent crude traded above $103 per barrel on Friday, holding gains of roughly 3 percent even after President Donald Trump pushed back his deadline for potential strikes on Iranian power infrastructure for the second time. The US benchmark held above $97 per barrel. Earlier in the conflict, both benchmarks briefly touched levels not seen since the weeks following Russia’s invasion of Ukraine in early 2022.
What $200 oil would actually mean
A move to $200 per barrel would surpass the previous all-time high for Brent crude set in 2008 at approximately $147.50, and it would do so in a global economy that is already contending with elevated inflation, strained supply chains and weakening consumer confidence in major markets.
The aviation industry is among the sectors most exposed to the current trajectory. One major American airline projected internally this month that oil prices could reach $175 per barrel and remain elevated well into 2027. The company estimated that sustained prices at that level could add more than $11 billion in annual fuel costs, a figure that would fundamentally reshape its financial planning for years. Jet fuel prices have already roughly doubled since the conflict began.
Saudi Arabian energy officials have offered similarly stark projections, reportedly warning that prices could reach $180 per barrel if the fighting extends into late April. The alignment of forecasts across different institutions and industries reflects a market that is beginning to price in a prolonged conflict rather than a swift resolution.
The delay between supply loss and full impact
One of the more unsettling aspects of the current situation, according to energy economists, is that the full economic weight of losing a fifth of global supply has not yet been absorbed. The conflict is only weeks old, and the ripple effects of supply disruption tend to accumulate over time rather than arriving all at once. Businesses are still drawing down inventories, contracts signed before the war are still being honored and demand destruction has only just begun to register in the data.
Energy analysts speaking at a major industry conference this week noted that the market remains in a phase of delayed reckoning, and that if the Strait of Hormuz stays effectively closed to normal traffic through the summer, price pressure could intensify well beyond current levels.
The oil futures market reflects an expectation that Trump will reach a resolution quickly, with the price curve signaling a belief that the disruption is temporary. But uncertainty about what a declared victory would actually require, combined with continued strikes on energy infrastructure, has kept that optimism fragile. A shift in that expectation, even a partial one, could send prices moving sharply and quickly in one direction.
