A. SREENIVASA REDDY (ABU DHABI)
Crude oil prices could move towards $150 per barrel if a full-scale conflict breaks out again between the US and Iran, according to an estimate by Rystad Energy, a global energy consultancy.
The assessment comes amid continued uncertainty over whether the latest escalation in the region will remain contained or lead to a more sustained conflict cycle.
“At this stage, it is too early to say whether the current escalation marks a full resumption of hostilities or a dangerous but still containable episode,” said Jorge Leon, Senior Vice-President and Head of Geopolitical Analysis at Rystad Energy.
That uncertainty has been reflected in recent oil price movements, with Brent trading around $94-$95 per barrel. However, Rystad Energy said the upside in prices could be limited by three key factors: record levels of strategic petroleum reserve releases that have supported record US exports, reduced crude imports by China, and the continued movement of around 5 million barrels per day of crude bypassing the Strait of Hormuz.
While these factors may help blunt the immediate price response, Rystad Energy cautioned that the broader geopolitical outlook has become more uncertain. “What is clearer is that the probability of a near-term deal has narrowed from our prior assessment of around 40% a few weeks ago,” Leon said.
“The direction of travel is now more uncertain, and the next few days will be critical in determining whether diplomacy can reassert itself or whether the conflict moves into a more sustained escalation cycle,” he added.
Leon said oil price volatility is likely to remain elevated until there is clearer evidence that the ceasefire can hold or that diplomatic channels are regaining traction.
The risk of a prolonged supply disruption has also been reflected in the latest S&P Global Ratings’, which has revised its Brent crude assumptions to $110 per barrel for 2026 and $80 per barrel for 2027.
“This adjustment reflects a more prolonged and structurally severe supply disruption than previously anticipated, coupled with rapidly depleting inventory buffers and a sluggish recovery in global flows,” S&P Global Ratings said.