Oil Prices May Hit $150 per Barrel Soon if Iran War Continues, Energy Economist Says

Why It Matters

A $150 price would reshape global energy costs, pressure inflation, and force strategic shifts for both consumers and producers.

Key Takeaways

• Brent at $94; $150 target if conflict continues
• Inventories low; price rise tied to Hormuz flow capacity
• Raising Hormuz throughput to 10 mln bpd could stabilize market
• UAE exit may trigger surplus by 2027, adding uncertainty
• Prolonged war could amplify inflation and shift investment to alternatives

Pulse Analysis

The current oil rally is rooted in a perfect storm of geopolitical tension and dwindling stockpiles. Since the Iran‑U.S. hostilities began more than 100 days ago, crude inventories have slipped to levels not seen in a decade, tightening the supply‑demand balance. Brent’s price, hovering around $94, reflects traders’ anticipation of further disruptions, while the specter of $150 per barrel looms if the conflict deepens. Analysts point to the Strait of Hormuz—a chokepoint that moves roughly two million barrels daily—as a critical lever; unlocking additional capacity could blunt price spikes.

Rystad Energy’s chief economist, Claudio Galimberti, proposes a pragmatic fix: increase Hormuz throughput to ten million barrels per day within the next three to six months. Such a surge would flood the market with enough crude to offset the inventory deficit, restoring a more normal price trajectory. However, the outlook is complicated by structural shifts in the producer landscape. The United Arab Emirates’ recent departure from OPEC signals a potential oversupply scenario as early as 2027, when former deficits could reverse into a “humongous surplus.” This dual‑risk environment—upside price pressure now, downside oversupply later—creates a volatile pricing environment for traders and end‑users alike.

For the broader economy, a sustained $150 price tag would reverberate through inflation metrics, transportation costs, and corporate earnings, prompting policymakers to reconsider energy subsidies and strategic reserves. Simultaneously, the threat of an oversupplied market could accelerate investment in alternative energy sources, as producers hedge against future price collapses. Investors therefore need to monitor both the geopolitical timeline and OPEC’s evolving composition to gauge the next wave of oil market dynamics.