Brace for $200 Oil If War Lasts Till June, Macquarie Warns

Article content(Bloomberg) — Oil may hit a record $200 a barrel if the Iran war drags on till June, with the Strait of Hormuz staying shut, Macquarie Group Ltd. said.Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentA conflict that stretches through the second quarter would result in historically high real prices, analysts including Vikas Dwivedi said in a note, outlining a scenario with odds of 40%. An alternative outlook, with probability of 60%, suggested the war may finish at the end of this month, they said.Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Article contentBrent crude is on pace for a record monthly gain in March, as the war between the US, Israel and Iran has rocked the oil-rich Middle East. The conflict has seen Tehran oversee a near-complete closure of the Strait of Hormuz, severely restricting flows of energy vital to the global economy.Article contentArticle content“If the strait were to stay closed for an extended period, prices would need to move high enough to destroy an historically large amount of global oil demand,” the analysts said in the March 27 report. “The timing of the re-opening of the straits, and physical damage to energy infrastructure, is the main determinant of the longer-term impact on commodities.”Article contentTop StoriesGet the latest headlines, breaking news and columns.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article contentBrent was last near $108 a barrel on Friday, after touching a crisis-high of $119.50 earlier this month. The benchmark set a nominal peak of $147.50 a barrel in 2008, according to data compiled by Bloomberg.Article contentOn Thursday, US President Donald Trump pushed back a deadline for striking Iran’s energy sites by 10 days, with the second pause to that threat stretching the timeline on potential attacks to April 6. Iran had allowed 10 oil tankers to sail through the strait as a goodwill gesture, he said.Article contentThe closure of the strait “has sent both crude and refined-product prices soaring due to the magnitude of the disruption,” the analysts said. In pre-conflict times, the waterway saw daily transits of about 15 million barrels of crude, as well as 5 million barrels of refined-products, they said.Article content(Updates to add Trump’s decision in penultimate paragraph.)Article contentTrending Meet the Canadian e-bike maker who is redefining the factory floor Electric Vehicles Markets could be making the wrong call on interest rates Investor Iran oil revenue soars as it's the only exporter out of Hormuz Oil & Gas Quebec demands Air Canada’s CEO resignation in 92 to 0 vote Airlines LNG Canada signs key pipeline agreement required for phase two expansion Energy Share this article in your social networkCommentsYou must be logged in to join the discussion or read more comments.Create an AccountSign in Join the Conversation Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information. Meet the Canadian e-bike maker who is redefining the factory floor Electric Vehicles Markets could be making the wrong call on interest rates Investor Iran oil revenue soars as it's the only exporter out of Hormuz Oil & Gas Quebec demands Air Canada’s CEO resignation in 92 to 0 vote Airlines LNG Canada signs key pipeline agreement required for phase two expansion Energy