Blackrock chief warns $150 oil could trigger global recession

""If oil prices stay elevated and Iran remains a threat, that will have profound implications," he said, warning that a scenario of sustained high prices could lead to "a probably stark and steep recession.""

"Higher energy costs hit the poorest the hardest," he said, noting that sustained increases would not only dampen consumer spending but also exacerbate inequality."

"In a more optimistic scenario, a resolution to the conflict and a stabilisation of relations could see oil prices fall back below pre-war levels, easing inflationary pressures and supporting growth."

"However, in the more pessimistic case, prolonged instability could drive oil prices above $100, and potentially towards $150, for several years."

Larry Fink, CEO of BlackRock, warned that if oil prices remain high due to geopolitical tensions, particularly involving Iran, the global economy could face a severe recession. He outlined two scenarios: one optimistic, where conflict resolution leads to lower prices, and one pessimistic, where prolonged instability keeps prices elevated, harming economic activity. Rising energy costs disproportionately affect lower-income households, exacerbating inequality and dampening consumer spending. Policymakers are urged to adopt a pragmatic energy policy to mitigate these impacts.

Read at Business Matters