According to Capital Economics, global oil prices could exceed $150 per barrel if the military conflict in Iran drags on. This extreme scenario would maintain record prices for North Sea crude through the end of 2027 and accelerate global inflation.
The baseline forecast envisions a recovery in Middle Eastern energy supplies in the near future. However, in a detrimental outcome, Iranian military attacks on regional energy infrastructure could continue, potentially driving Brent crude prices up to $130 per barrel by mid-2026. Such high prices could fuel global inflation rates by 2.5% in the latter half of 2026.
The prolonged blockade of the Strait of Hormuz remains a key catalyst for the rapid increase in crude and fuel prices in international markets. Before hostilities began, this strategic logistical artery in the Middle East facilitated the transportation of a significant portion of global hydrocarbon flows. The closure of this maritime route quickly inflated the market value of crude, with quotes peaking at nearly $120 per barrel during periods of heightened tensions.
Currently, North Sea crude is trading in international markets at approximately $108–$109 per barrel. American investment bank Goldman Sachs also confirms the inevitability of Brent crude prices rising to around $150 per barrel in the event of a prolonged blockade of the strait. Reuters notes that these forecasts reflect growing concerns among major financial institutions regarding the stability of supply chains.
