New York — 

In the summer of 2008, weeks before the investment bank Lehman Brothers imploded, oil prices skyrocketed to nearly $150 a barrel. Some oil watchers are warning of even higher prices this summer if the vital Strait of Hormuz doesn’t reopen soon.

US oil prices have already spiked from about $65 to around $100 since the start of the war in the Middle East. Crude spiked by 51% in March alone, the second-biggest one-month increase since futures trading launched in 1983.

Meanwhile, gasoline prices have surged above $4 a gallon nationally and will likely increase the cost of everything from groceries to air travel.

President Donald Trump on Tuesday insisted that the conflict will end in the coming weeks and that gas prices will “come tumbling down” once that happens. But if the war doesn’t end soon, some oil analysts caution that a prolonged conflict and a failure to reopen the Strait of Hormuz will be very costly.

If the war lasts through June, oil prices would likely spike above $200 a barrel “for a time,” according to research published recently by Australian investment bank Macquarie Group.

Vikas Dwivedi, global oil and gas strategist at Macquarie, told CNN on Wednesday there is roughly a 20% chance of that, down from 40% late last week. He said $200 oil is possible even if the war ends but the Strait of Hormuz remains mostly closed, a situation Trump has floated recently.

“President Trump and his entire energy team have had a plan in place to mitigate any short-term disruptions to the energy markets and have continued to quickly take action when necessary,” White House spokeswoman Taylor Rogers said in a statement.

If oil reaches $200, it would damage the global economy. This would translate to gas prices of roughly $7 a gallon in the US, shattering the prior record of $5.02 set in June 2022.

While $200 oil sounds extreme, analysts say it reflects the scale of the supply disruption and pointed to the fact that Dubai oil prices recently topped $166 a barrel.

The thinking is that if oil doesn’t start flowing out of the Middle East soon, prices would have to go high enough to balance the market by crushing demand.

In 2008, that level was nearly $150 a barrel. Adjusted for inflation, it could be above $200.

“The price will go to whatever level is required to slow GDP,” Bob McNally, president and founder of Rapidan Energy Group, told CNN in a phone interview. “No one knows exactly what level that is, but I think high $100s or even over $200 is reasonable, unfortunately.”

The clock is ticking to solve the biggest oil supply disruption in history.

Bank of America estimates that in March alone, the world economy lost about 14 million to 15 million barrels per day of crude oil and energy products like diesel and jet fuel. The bank expects oil prices will hover around $100 a barrel for the rest of the year – and could go even higher if the Strait of Hormuz’s closure continues to disrupt energy supplies.

“Should most of these energy flows not be restored within the next two to four weeks, we believe that a breakdown of the global oil supply chain would be inevitable,” Bank of America analysts wrote in a report on Wednesday.

The breakdown of the supply chain would force demand rationing and could trigger “consequences reminiscent of, or possibly worse than, the energy crises of the 1970s,” the bank said.

Bank of America estimates that an “extended” supply loss would likely drive oil prices above $150 a barrel this quarter.

Of course, all of these forecasts must be taken with a grain of salt.

A White House official described the high oil price forecasts from analysts as “irrelevant because they can’t reliably predict military progress, and when this operation will conclude.”

Trump’s tariff rollout last year shows how quickly economic forecasts can be made moot by policy pivots from the White House.

Last April, economists and investors braced for an imminent recession after Trump slapped historically high tariffs on imports. Stocks plummeted. Bond yields skyrocketed.

But that recession never arrived. Trump blinked, pausing and watering down many of those tariffs in response to extreme market pressure.

Flash forward to today, and it’s easy to see how oil prices could crash back to earth if the Strait of Hormuz reopens soon and energy infrastructure in the Middle East gets repaired quickly. Even just a US exit from the conflict would likely cause at least a short-term drop in oil prices, analysts say.

“All I have to do is leave Iran, and we’ll be doing that very soon, and they’ll come tumbling down,” Trump said on Tuesday.

Bank of America laid out three scenarios for where oil prices go next.

If there is a “rapid deescalation” in the Middle East, Bank of America expects Brent oil would average just $77.50 a barrel in 2026.

In a second, more likely scenario, the war ending in two to four weeks would translate to oil averaging $92.50 a barrel this year. That would mean elevated prices but not a nightmare for the economy.

In its most severe scenario, Bank of America sees a “triple-whammy” of near-zero real income growth for consumers, job losses and stock market turmoil.

“The escalation scenario could push the US economy into a recession within a few months,” Bank of America said.

The Trump administration has taken drastic steps aimed at easing the supply crunch, including releasing an historic amount of oil from emergency reserves, promising to support maritime insurance and temporarily lifting limits on the shipping of oil, gasoline and other commodities throughout the United States.

“The tools President Trump has used are good ones. They’re just too small,” said McNally, a former energy adviser to President George W. Bush. “Hormuz is just way too big of a problem for the president’s toolkit to fix.”