According to Citi Bank, potential retaliatory actions by Israel in response to the recent missile attack from Iran could threaten the country’s key oil production infrastructure. This could lead to a reduction in oil output by several million barrels per day, which would intensify upward pressure on prices. As a result, Citi analysts suggest that, in the event of an escalation in the Middle East conflict, oil prices could rise by more than 60%, reaching $120 per barrel by early 2025.

However, a different scenario could unfold if Israel adheres to its commitment not to attack Iran’s nuclear and oil facilities. In this case, oil prices are expected to remain around $74 and could drop to $60 per barrel over the next year. Furthermore, prices could decrease by 18% if Saudi Arabia, the UAE, and other major producers step in to prevent supply disruptions. Citi analysts estimate that OPEC+ could produce an additional 6 million barrels per day, helping to stabilise the market. A weakening Chinese economy could also contribute to reduced oil demand.

Some analysts believe that potential disruptions to Iranian oil supplies may not cause significant issues. Saudi Arabia’s oil minister, Abdulaziz bin Salman, even suggests that OPEC+ producers are extracting too much “black gold,” indicating that prices could fall by more than a third—specifically, by 33%.