Experts Divided on Oil Price Impact of U.S.-Iran Conflict

Analysts offer wildly divergent forecasts on how a confrontation would affect global oil markets.

Published on Feb. 27, 2026

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Experts are sharply divided on what a potential U.S.-Iran conflict would mean for global oil prices. Some warn of a major price spike, while others predict only a modest, temporary increase. The oil market is currently oversupplied, but analysts disagree on whether existing inventories could cushion the impact of disrupted Iranian exports.

Why it matters

The prospect of a U.S.-Iran confrontation has significant implications for the global economy, as oil prices are a key driver of inflation, consumer spending, and business investment. The wide range of expert forecasts reflects the high level of uncertainty surrounding how such a conflict could unfold and its potential ripple effects across energy markets.

The details

Some analysts, like those at RBC Capital Markets, argue the risk of a U.S.-Iran confrontation remains high and warn that oil prices could spike as high as $148 per barrel, similar to the 2008 price surge when spare capacity was thin. In contrast, Rystad Energy consultants suggest prices might jump only $10 per barrel and then quickly rebound, especially if Iran's retaliation is limited. The core disagreement centers on whether ample global oil inventories can easily offset any loss of Iranian exports.

  • The oil market is currently oversupplied, with the International Energy Agency forecasting a 3.8 million barrel-per-day surplus for 2026.
  • In the second quarter of 2022, the geopolitical premium in oil prices reached nearly $47 per barrel due to sanctions on Russian exports after the invasion of Ukraine.
  • Currently, the geopolitical premium in oil prices sits at only $4 per barrel, despite recent tensions between the U.S. and Iran.

The players

RBC Capital Markets

A financial services firm that released a report warning the risk of a U.S.-Iran confrontation remains high.

Rystad Energy

An energy consulting firm that suggested oil prices might jump only $10 per barrel and then quickly rebound in the event of a limited conflict between the U.S. and Iran.

International Energy Agency (IEA)

The intergovernmental organization that is forecasting a 3.8 million barrel-per-day surplus of oil for 2026.

Amy Myers Jaffe

A research professor at New York University's Center for Global Affairs and director of the Center's Energy, Climate Justice and Sustainability Lab, who has studied the impact of military conflict and regime change on oil prices for two decades.

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What they’re saying

“We must not let individuals continue to damage private property in San Francisco.”

— Robert Jenkins, San Francisco resident (San Francisco Chronicle)

The takeaway

The wide range of expert forecasts on the potential oil price impact of a U.S.-Iran conflict highlights the high level of uncertainty surrounding such geopolitical events and their ripple effects across global energy markets. Policymakers and businesses will need to closely monitor developments and prepare for a variety of possible scenarios.