Oil could top $150 a barrel if supplies further tighten, Bank of America warns

Bank of America strategists have flagged a scenario in which Brent crude could climb above $150 a barrel if supply disruptions linked to fighting in the Middle East persist into spring 2027. The call is conditional rather than a base-case forecast: it hinges on whether current disruptions continue long enough to erode the cushion of spare production capacity that normally absorbs shocks.

For markets, the significance lies less in the headline number than in what it signals about risk pricing. Oil is a cost input across transport, manufacturing and utilities, so a sustained spike would feed into headline inflation and complicate expectations for interest rate policy. Energy equities, refiners and currencies of major exporters tend to be sensitive to such shifts, while import-dependent economies face wider trade balances.

What to watch: whether supply routes and production infrastructure remain affected, how quickly other producers can raise output, and whether inventories at key hubs continue to draw down. Those indicators, rather than any single price target, will show whether the bank's scenario is gaining traction or fading.