Larry Fink warns oil hitting $150 could trigger sudden global recession

BlackRock CEO Larry Fink warns high oil prices would have profound repercussions for the global economy

BlackRock CEO Larry Fink has issued a warning amid the escalating conflict in the Middle East. Speaking to the BBC, Fink said “If oil prices rise to $150 a barrel it could trigger global recession.”

Fink explained that prolonged high oil prices would have profound repercussions for the global economy. He noted that the worst-case scenario would be oil prices remaining above $100 and approaching $150 for several years.

He indicated that the course of the crisis remains unclear, but it boils down to two main scenarios. First, a de-escalation of the conflict and Iran's reintegration into the international community, which would allow oil prices to fall below pre-war levels. Second scenario, a continuation of tensions, which would drive energy prices up for an extended period and cast a shadow over the global economy.

Fink emphasized that rising energy prices represent a disproportionate economic burden, disproportionately affecting lower-income groups. He argued that providing affordable energy is essential for supporting growth and raising living standards.

Regarding financial markets, Fink ruled out a repeat of the 2008 global financial crisis, asserting that the financial system is currently more robust and that the pressures experienced by some private equity funds represent a limited segment of the market, while institutional investment flows remain strong.