Senior Bank of America executives say that one commodity will skyrocket if the Iran War continues.
Francisco Blanch is the head of Bank of America’s commodities and derivatives. He says that, if this war continues, oil prices could become “very, extremely complicated.”
Blanch says that oil prices could reach up to $200 per barrel under such circumstances.
“… if we’re still at the same spot in May and looking to the third quarter I have already said we may see spikes up to $160 per barrel.
“If things continue to go well, Brent could break $200 per barrel.”
Brent Crude currently trades at $108 as of the time this article was written.
Blanch says countries will also be motivated to boost their oil reserves as a consequence of a global supply shock caused by Iran’s blocking of the Strait of Hormuz. This is where one fifth of all oil passes. Blanch believes that this would be a positive for oil prices in the long run.
Remember, in the 1990s Japan pushed for just-in-time [inventory management strategy]. In the 90s, Japan was pushing for a just-in time [inventory strategy ].
In the 2020s [China] will be accumulating inventory just in case. They’ve built up massive oil reserves… I think that this trend will only accelerate once the war is over. This, I believe, will support commodity prices for a long time.
Blanch believes that if the Iran conflict is not resolved, it could lead to an economic downturn.
We need to see the war ending, otherwise, the risk of recession is going to increase by the day as April approaches …”
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Sources of Images include Pixabay Creative Commons & Midjourney
The post Bank of America’s Director of Commodities and Derivatives Research: This Commodity could explode 85% if Iran War persists may be updated as new information becomes available.
