Scott Bessent, former BlackRock executive, has predicted that oil prices could plummet to $40 per barrel following the conclusion of the Iran war, potentially impacting bond yields. Brent crude currently trades around $95.50 per barrel while the U.S. 10-year Treasury yield stands at approximately 4.79%. The market currently prices only a 1.6% probability of oil reaching a new all-time high by September 30, and a 10% probability by year-end if this forecast materializes. This scenario would represent a substantial drop in oil prices, affecting inflation-sensitive markets and potentially altering the trajectory of global energy prices amid geopolitical tensions and OPEC production decisions.
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