The price for a barrel of Brent crude has jumped to $108.77, marking the biggest daily gain since the start of the pandemic in 2020 and on top of a 28 percent rise last week, Al Jazeera reported.
The surge comes as the US and Israel’s war on Iran continues, and traffic through the vital Strait of Hormuz remains at a near halt, with Iranian forces attacking ships that dare to pass through.
“The global economy remains dependent on the concentrated flow of Mideast oil and natural gas through the Strait of Hormuz,” said Bruce Kasman, chief economist at JPMorgan.
“The near-term scenario is a near-term spike towards $120 bbl followed by moderation as the conflict soon subsides,” he told the Reuters news agency. “But absent a clear and decisive political resolution, Brent crude oil prices are expected to settle at an elevated $80 bbl through mid-year.”
According to Kasman, such an outcome could cut global economic growth by an annualised 0.6 percent for the first half of this year and push consumer prices up by 1 percent.
He warned that if the conflict widens and drags on, oil prices could surge past $120 a barrel, potentially tipping the world into recession.
bd-pratidin/GR
