How high could oil go, and what might the global economic fallout be?

There is talk of crude surpassing its record high of 2008 with potentially dire effects for consumers and businesses

Fears over the global economy have been stoked by the oil price soaring past $100 a barrel as a result on the US-Israel war with Iran.

Economists say the increasing likelihood of a prolonged conflict in the vital energy exporting region could have serious consequences for living standards around the world amid the threat of a renewed inflation shock.

Against a highly uncertain backdrop, financial markets are under heavy selling pressure, consumers are facing rising prices, central banks could be forced to increase borrowing costs and governments will come under pressure to support households and businesses.

Oil prices passed $119 a barrel on Monday, the highest level since Russia’s full-scale invasion of Ukraine in February 2022. Analysts say the continued closure of the strait of Hormuz could drive the price close to $150 a barrel, above the record high of $145.29 set in July 2008.