Economists warn of 'stagflation' risk
Rising oil prices from the Iran conflict are raising fears of stagflation, with Oxford Economics projecting a 0.7% drop in Eurozone GDP and world CPI peaking at 5.8% [https://fortune.com/2026/03/12/recession-stagflation-oil-iran-trump-deutsche-oxford-economics/].
Oxford Economics suggests that if the conflict escalates, oil prices could surge to $150 a barrel. This spike would intensify inflationary pressures while simultaneously depressing economic output. Deutsche Bank analysts predict that a sustained oil price increase to $150 would likely push the Eurozone into recession. They also foresee the U.S. potentially experiencing a "growth recession". The potential for a return of Donald Trump to the White House adds another layer of uncertainty. His policies could exacerbate or mitigate the economic fallout, depending on his approach to the conflict and trade relations.
