JPMorgan: Oil Could Surge Above $150 amid Escalating Middle East Disruptions

Global oil markets could be on the brink of a sharp escalation, with JPMorgan warning that crude prices may exceed $150 per barrel if supply disruptions in the Middle East persist into mid-May.

In a note released, the banksaid that prises could rise to around $120 and $130 per barellel in the short run, due to the escalation of tentions, that is connected with the the disruption of supplies through the Strait of Hormuz. 

The Strait of Hormuz remains a vital artery for global energy flows, with a significant share of the world’s crude exports passing through it daily. Any sustained disruption in this corridor could trigger immediate supply shortages and heightened price volatility.

JPMorgan’s worse case scenario suggests that if shipments continue to be constrained through mid-May, oil could spike beyond $150, levels not seen in years and likely to send shockwaves through the global economy.

In its baseline outlook, however, the bank assumes that the supply disruption will be resolved through negotiations after a period of tightening inventories and constrained flows.

Under this scenario, oil prices are expected to remain above $100 per barrel throughout the second quarter, before gradually easing in the second half of 2026 as partial flows resume and stockpiles recover.

The bank warned that the duration and severity of the price increases would be crucial in determining the extent of the economic impact. Prolonged spikes could dampen global demand, increase inflationary pressures, and raise the likelihood of an economic slowdown, or even recession, if energy costs remain elevated.

The warning comes amid heightened geopolitical tensions following statements by Donald Trump indicating that the United States would continue its military actions against Iran, further fueling market uncertainty.

Oil prices have already shown sharp volatility, reacting quickly to geopolitical developments and shifting expectations concerning supply. Analysts say the coming weeks will be critical in determining whether the markets will witness short-lived crises or a prolonged shock.

For now, JPMorgan’s outlook underscores a fragile equilibrium, one where geopolitics, rather than fundamentals alone, may dictate the trajectory of global energy prices.