Economics Research: Iran War Could Push Global Oil Above $120 Under Three Conditions

The Iran war has already changed the global economy. According to Sina Finance, before the conflict broke out, many forecasters expected oil prices to hover around $50 per barrel, but prices are now near $97 and could still rise to $120. According to Sina Finance, reaching that level would require an escalation in military conflict, the closure of the Strait of Hormuz, and a disruption to alternative export routes. The article said geopolitical tensions are already close to escalation, with the United States and Iran trading attacks on tankers, Washington tightening its blockade, and Tehran trying to break it and regain control of the Strait of Hormuz. According to Sina Finance, traders estimate that 7 million to 8 million barrels of crude passed through the strait each day in late August, often without being noticed, even though the number of observed ships suggests the strait has effectively been closed. The article said Iran may try to block that oil flow, and the emerging tanker war may reflect that intention. According to Sina Finance, four alternative routes currently carry most of the oil bypassing the Strait of Hormuz: Saudi Arabia's east-west pipeline, the port of Fujairah in the United Arab Emirates, several ports in Oman, and the Iraq-Turkey pipeline. The article said pressure on these routes is increasing, with Houthi attacks affecting Saudi exports and Iran threatening to extend restrictions beyond the Strait of Hormuz. According to Sina Finance, the Iran war has delivered a major oil shock to the global economy. Although a pause in the conflict kept crude below $90 per barrel for most of this summer, its inflationary effect continues, and renewed escalation would add fresh pressure on consumer prices and prompt central banks to raise interest rates.