J.P. Morgan admits uncertain oil outlook
J.P. Morgan, the American investment bank, acknowledged the difficulty in predicting the trajectory of oil prices amid the US-Iran war, as supply risks expand and no clear scenario for the war's end emerges. Although oil prices have surpassed $100 per barrel, the bank estimates the fair value at around $90, with a premium associated with the potential escalation of disruptions to shipping through the Strait of Hormuz and the Bab el-Mandeb, as well as increasing risks stemming from the Russia-Ukraine war. Analyses confirmed that the lack of clear indicators of de-escalation makes markets susceptible to sharp and sudden movements in the coming period, potentially leading to higher costs and embroiling major economies in a new wave of inflation.
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