JPMorgan has acknowledged that ongoing hostilities across the Middle East have left the bank without a definitive outlook on where oil prices are headed. The institution's research team stated in a note that it was unable to establish a forecast position on crude oil — an approach described as uncommon for a bank of that scale covering one of the most closely monitored commodity markets — adding that this represented the first time a view could not be formed since hostilities between the United States, Israel, and Iran commenced.
Trump's approach to the conflict has varied, leaving investors and traders uncertain about how to proceed. JPMorgan has publicly stated that the outcome of the conflict cannot be predicted, a position traders had previously expressed only in private conversations.
JPMorgan analysts indicated that their earlier forecasts had operated on the assumption that certain economic thresholds — including oil prices reaching $100 a barrel or petrol hitting $5 a gallon — would serve as boundaries the administration was unlikely to breach. Those thresholds do not appear to have altered the administration's course on Iran policy. Trump has signalled that a consequential decision regarding Iran is forthcoming, and that military action up to and including the destruction of its government remains among the options under consideration.
The 10-year Treasury yield has climbed toward the 5% threshold over the past week. Bond markets draw close attention from both financial institutions and government bodies, and sharp price swings tend to prompt concern among regulators given the sector's central role in domestic and international finance.
A number of JPMorgan's prior projections turned out to be notably inaccurate. Towards the end of that month, the institution forecast that sustained disruptions to the waterway through mid-May had the potential to push crude prices to $150 per barrel. Crude prices reached a peak of approximately $125 per barrel before settling around the $100 mark, a level they have largely maintained despite recurring supply disruptions.
Bank analysts had also forecast that petroleum stockpiles across OECD nations would reach threshold minimums by May, a point at which price escalation would shift from gradual to exponential — though reserves globally proved more resilient than many forecasters, including JPMorgan, had anticipated. JPMorgan analysts noted that reduced consumption rather than falling stockpiles has played a greater role in offsetting the supply shortfall and keeping crude prices from rising further.
The International Energy Agency has revised its outlook, projecting a contraction in global oil consumption of 2.5 million barrels per day by 2026, a figure that exceeds the agency's August forecast by 940,000 barrels per day. Subdued household and business spending has also pulled down overall demand, as both groups opt to cut back rather than absorb higher prices.
Petroleum geologist Art Berman has noted that the impacts have fallen unevenly across different groups. Developing nations that rely heavily on imports tend to absorb the initial strain of energy price increases, as elevated fuel costs combined with weakened local currencies place a compounded financial load on these economies. Berman noted that those who exit the market first are typically fertiliser purchasers across Africa, transport operators in Pakistan, manufacturing facilities in Bangladesh, and households throughout import-dependent nations — a pattern consistent with what economists describe as demand contraction during periods of energy scarcity.
Following the upheaval in Iran in 1979, fuel demand among the general public dropped by nearly a fifth over the next four years. Between January and July 2008, the price of crude oil climbed from roughly $90 per barrel to a then-record peak of $147. The sharp price shift led to a notable contraction in demand, weighing on household expenditure, and a number of analysts have pointed to it as an underappreciated factor in the broader global economic turbulence that followed.
By late 2025, European energy use had fallen roughly 20% below pre-2022 levels, a decline that followed the continent's move away from Russian natural gas supplies. Reductions from peak pricing offered only partial relief, as manufacturing operations had already closed and certain energy-intensive activities had been moved to foreign locations.
Crude prices drifted downward late in the week as markets anticipated the restoration of supply through Saudi Arabia's East-West pipeline following a drone strike that left the infrastructure damaged. On Friday afternoon in London, Brent crude held above the $100 threshold, exchanging hands at around $103 per barrel.
