Wood Mackenzie warns $200 is possible if conflict extends, in what would be the largest supply disruption in industry history

Oil prices could reach $150 a barrel within weeks as the shutdown of 15 million barrels per day of Gulf exports forces the global economy to destroy demand rather than find alternative supply, according to new analysis from energy consultancy Wood Mackenzie.

The scale of the disruption is without precedent. Gulf countries produce 20 million barrels per day in total, and 15 million barrels per day of exports have been removed from global markets in a single shock that dwarfs any previous supply crisis, including the Russia-Ukraine war of 2022.

Prices have already broken above $100 a barrel as buyers compete for remaining cargoes, but Wood Mackenzie's chairman and chief analyst, Simon Flowers, argues this is only the beginning of the price escalation required to bring supply and demand back into balance.

"Global oil demand of 105 million barrels per day will still have to fall to balance the market and in our view, that will require Brent to push up at least to $150 a barrel in the coming weeks," said Flowers.

Europe is among the most acutely exposed regions. Gulf refineries supplied 60% of Europe's jet fuel and 30% of its diesel in 2025, volumes which have been entirely cut off.

The severity of the squeeze is visible in product markets, where jet-fuel crack spreads, the margin refiners earn processing crude into aviation fuel, have traded at $100 a barrel in northwest Europe, implying a Brent crude price close to $200 a barrel, while diesel crack spreads have reached $70 a barrel, four to five times their pre-war levels.

Asia faces equally severe pressure, with Chinese, Indian and other buyers scrambling for West African and Latin American crude to replace lost Gulf supplies, intensifying competition with European buyers and driving up prices across the board.

Strategic petroleum reserves offer limited relief. International Energy Agency member countries hold stocks equivalent to 90 days of imports, but sustained releases are historically unprecedented and IEA members represent less than half of global demand.

Reserve releases during the Russia-Ukraine crisis failed to prevent Brent reaching $125 a barrel, and the current supply gap is materially larger.

US shale producers could add a few hundred thousand barrels per day over three to six months by accelerating output and deferring maintenance, but this represents a fraction of the 15 million barrel per day shortfall.

Flowers said $200 a barrel cannot be ruled out if the conflict extends, noting that the volumes at risk this time are both dimensionally larger than in previous crises and, critically, already offline rather than theoretical.

"When the conflict ends, cranking up the supply chain won't be swift," he added. "If wells are shut-in for a prolonged period, restarting production to full output could take weeks or even longer."