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(Bloomberg) -- More than six months after the start of the Iran war, JPMorgan Chase & Co.’s oil analysts are stating what many traders have been saying privately for some time: the path to the end of the war is increasingly impossible to predict.Several economic red lines that the bank assumed the US administration would be unwilling to cross — including oil rising above $100 a barrel, gasoline prices nearing $5 a gallon and surging treasury yields — have already happened, making the exit strategy less clear, analysts including Natasha Kaneva said in a note.Oil traders and analysts are increasingly unsure about how long the Iran war will last as energy prices surge and the ripple effects threaten to derail global economic growth and stoke inflation. Critical energy infrastructure, including Saudi Arabia’s vital East-West pipeline have come under attack recently, fueling worries about further supply tightness.“The market is on edge, in our view,” the analysts said in a note, widely cited by market participants on Thursday. Oil’s fair value in September is estimated at around $90 a barrel even though prices are close to $106, the analysts said, adding that it implies the market is pricing in the risk of an additional 4 million barrels a day of supply losses on top of the 10 million barrels a day already disrupted. “With no clear signals from either the US or Iran that they are prepared to de-escalate — and absent a diplomatic breakthrough on Sept. 24, when President Trump and President Xi are set to meet in DC — the assumption that the disruption is temporary is becoming increasingly difficult to sustain,” the analysts wrote.The global inventory cushion has dwindled during the war but for now, there is still enough of a buffer to limit crude prices from gaining further, they said.However, if Middle Eastern flows remain at current levels, the firm estimates fourth quarter and December 2026 prices could be $7 and $8 above current forecasts of around $80 and $78 a barrel, respectively.More stories like this are available on bloomberg.com©2026 Bloomberg L.P.
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