Brent may hit $150 if Syria impacts Iraq, SocGen warns
Brent crude oil prices may touch $150 a barrel if military action against Syria sparks a broader regional spill-over and causes supply disruptions in major producers like Iraq, Societe Generale warned.
Under such a scenario, the French bank classified a "significant supply disruption in Iraq or elsewhere" as affecting between 500,000 to two million barrels a day. "Brent could spike briefly to $150" if this materializes, said Michael Wittner, Global Head of Oil research at Societe Generale.
(Read more: Is a spike in oil prices around the corner?)
In the more immediate term, Brent could gain another $5 to 10 a barrel, surging to as high as $125 in the days ahead "either in anticipation of the attack or in reaction to the headlines that an attack had started," Wittner said.
However, demand destruction caused by high prices, spare capacity in Saudi Arabia and the availability of emergency stockpiles held by major consumers will ensure any Syria-related oil price spikes are temporary, he added.
Major energy consuming countries under the IEA (International Energy Agency) "would be particularly concerned with protecting the fragile economic recovery, which has only recently been gathering momentum in an apparently sustainable fashion."
Brent crude prices rose more than $2 on Wednesday to trade as much as $117.13, highs not seen since February this year.