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Global oil markets may be underestimating the scale of the current crisis, with Macquarie Group warning that crude prices could surge to an unprecedented $200 a barrel if the Iran conflict drags into mid-year and keeps the vital Strait of Hormuz shut.In a note dated March 27, as reported by Bloomberg, analysts including Vikas Dwivedi outlined a worst-case scenario with a 40% probability, where a prolonged conflict through the second quarter drives oil into “historically high” real price territory. A more optimistic outcome — pegged at 60% — sees hostilities ending by the close of this month.Traders, as per Reuters, have been piling into oil options betting Brent crude will surge to an all-time high of at least $150 a barrel by the end of April, as the war in the Middle East continues to choke supplies through the Strait of Hormuz.The $200 warning comes as Brent crude barrels toward its strongest monthly gain in years, fuelled by escalating tensions involving the U.S., Israel and Iran that have rattled the energy-rich Middle East.At the heart of the shock is the near-complete shutdown of the Strait of Hormuz by Tehran — a chokepoint that handles a significant share of global oil flows. The disruption has sharply curtailed supply, amplifying fears of a deeper energy crisis Prices remain on a knife edge, even as tentative signals emerge that Washington and Tehran may be looking for an off-ramp to the conflict. In derivatives markets, traders are bracing for further turbulence — with bets on oil hitting at least $150 a barrel by end-April surging nearly tenfold in recent weeks. Such a move would eclipse Brent crude’s previous record of $147 a barrel set in 2008, when runaway demand stretched supply to its limits.Data from Intercontinental Exchange shows a sharp spike in activity around April-expiry call options that give holders the right to buy June Brent futures at $150. Open interest in these contracts has ballooned to almost 10 times last month’s levels, underscoring how aggressively traders are positioning for a near-term price shock.“If the strait were to stay closed for an extended period, prices would need to move high enough to destroy an historically large amount of global oil demand,” the Macquarie analysts said in the March 27 report, as reported by Bloomberg. “The timing of the re-opening of the straits, and physical damage to energy infrastructure, is the main determinant of the longer-term impact on commodities.”Brent crude was trading near $107 a barrel on Friday, after spiking to a crisis high of $119.50 earlier this month. While prices remain below the nominal record of $147.50 set in 2008, the latest projections suggest markets may need to recalibrate — not to $150, but to the possibility of a far more extreme spike.Roughly one-fifth of the world's daily oil supply is currently trapped in the Gulf, which has pushed everything from the price of physical oil, to the cost of transporting and insuring it, to multi-year, or even record highs. Any sign of a meaningful pickup in marine traffic through the Strait of Hormuz is likely to result in markets reevaluating prices.Ownership of put options expiring in late April is concentrated well below current levels, with the most open interest between $45 and $70 a barrel. While positions in those strikes have also increased, the buildup has been far slower than in upside calls, suggesting investors see extreme outcomes in both directions but think there is a higher probability of further price spikes.Oil has breached the $100 mark for extended stretches before — most notably surging to $147 in 2008 and then averaging well above $100 between 2011 and 2014 — without derailing global economic expansion. But a sustained climb to $150 or even $200 a barrel would mark a fundamentally different regime, Forbes reported. At pre-crisis levels of roughly $65–70, oil spending accounted for about 2.5–3% of global GDP; at $150, that burden nearly doubles, pushing into the historically dangerous 5–6% zone.The duration of the spike is just as critical as the level. A brief, 10-day geopolitical surge can rattle sentiment without inflicting lasting economic harm. An extended stretch — say 18 months of elevated prices — would be far more disruptive, forcing a wholesale repricing of contracts, government budgets, and global supply chains."Elevated global crude oil and natural gas prices amid ongoing developments in West Asia may influence the Government of India's fiscal position for FY2026-27," ICRA said in the report, according to ANI.