Oil prices near $200 if conflict extends into summer
The prospect of oil prices climbing beyond $200 a barrel is no longer viewed as remote. Analysts increasingly warn that crude could reach record highs if disruptions in the Strait of Hormuz persist, tightening global supply.
According to a recent analysis by Macquarie Group, cited by Bloomberg, oil prices could exceed $200 per barrel “for a period of time” if the ongoing conflict stretches into June. In a more prolonged scenario, where hostilities continue through the third quarter and the Strait remains closed, prices could hit that threshold, triggering a sharp drop in global consumption due to unsustainable costs.
Such levels would surpass the previous nominal record of $147.50 reached in 2008. Adjusted for today’s dollar, that peak would be equivalent to nearly $230 per barrel.
Scenario: Strait of Hormuz remains closed even after hostilities
Vikas Dwivedi, global oil and gas strategist at Macquarie Group, told CNN there is currently a 20% probability of such a scenario, down from 40% the previous week. He noted that prices could still approach $200 even if the conflict ends, provided the Strait of Hormuz remains largely inaccessible.
The possibility of an indefinite closure had not been widely factored into earlier forecasts, but it was recently raised by Donald Trump.
“There is no policy lever that can stop oil prices from moving toward $200 per barrel if the Strait of Hormuz stays shut. The volume of supply at stake is simply too large for global markets,” said Jason Bordoff of Columbia University in comments to Axios.
Bob McNally, founder of Rapidan Energy Group, added in an interview with CNN that prices would rise “to the level required to slow GDP,” estimating that threshold could realistically approach or exceed $200 per barrel.
Supply chain under pressure as reserves decline
Much will depend on how quickly the Strait reopens and the extent of damage to critical energy infrastructure. If flows are not restored within weeks, Macquarie analysts warn that a breakdown of the global oil supply chain could become unavoidable.
So far, prices have been partially contained by temporary buffers, including oil already in transit and strategic reserves. However, these safeguards are rapidly diminishing. Tankers that passed through the Strait before the disruption have already delivered their cargo, leaving limited short-term relief for markets.
Trump signals prolonged military operations
In remarks that appeared at times contradictory, Donald Trump said the United States would “finish the job very quickly,” while also indicating that military operations would continue “very strongly for the next two or three weeks.” This outlook suggests ongoing disruptions to energy flows through the Strait of Hormuz, with no certainty that the conflict will end within that timeframe.
Following these statements, West Texas Intermediate rose by more than 10%, while Brent crude hovered near $110 per barrel. In Europe, diesel futures climbed above $200 per barrel for the first time since 2022.