Oil Price Caught in the Crosshairs of Global Crises
From Mild Fluctuations to Dramatic Jumps
Editorial Team (ET)May 9, 2025
In a world where geopolitical tensions and conflicts increasingly influence the economy, commodity markets, and particularly oil prices, become the focus of global analyses. Recent developments in the Middle East have significantly heightened the volatility of oil prices. Experts and institutions like the World Bank are analyzing the situation and outlining various scenarios, ranging from moderate price increases to dramatic price jumps.
Following an attack in the Middle East, the full impact of which on oil prices is yet to be seen, the World Bank has developed four possible scenarios. These range from a relatively stable price level to a significant price increase reminiscent of historical oil crises.
In the baseline scenario, the World Bank anticipates an oil price of about 90 US dollars per barrel, representing a moderate decrease compared to the previous year. This scenario is based on the assumption that the conflict will not have far-reaching effects on global commodity markets. The World Bank emphasizes that today's world economy is better equipped to deal with such shocks than in the past. The dependence on oil has decreased, and there are more oil producers as well as strategic reserves that contribute to price stabilization.
In a second scenario, which foresees a slight tightening of supply, the oil price could rise to up to 102 US dollars per barrel. This would occur if the supply is reduced by 0.5 to two million barrels per day. Such a scenario could be triggered by geopolitical tensions or sanctions against oil-producing countries.
A third scenario envisages a more significant tightening of supply, comparable to the outages during the Iraq War in 2003. In this case, prices could climb to 109 to 121 US dollars per barrel. This would occur if the supply is reduced by three to five million barrels per day.
The fourth and most dramatic scenario outlined by the World Bank would be a major disruption of oil supply, reducing the global supply by six to eight million barrels per day. In this case, oil prices could rise by 56 to 75 percent, thus reaching 140 to 157 US dollars per barrel. Such a development would have far-reaching consequences for the global economy and could lead to a global recession.
