JPMorgan warns oil above $90 could trigger 15% S&P 500 drop

JPMorgan said higher oil prices could set off a "domino effect" in equities, potentially sparking a 10%–15% correction in the S&P 500 if prices remain above $90 a barrel. Brent crude has hovered around $100 a barrel as markets monitor supply disruptions in the Middle East.

Bank researchers Kriti Gupta and Joe Seydl warned that as prices move toward and beyond $120 per barrel, selling in the S&P 500 would intensify and losses could spread internationally. The bank highlighted two channels by which higher oil could hurt US growth: higher pump prices—the national average for a gallon of gas rose to $3.63, up 21% since the start of the US-Iran war—and the wealth effect, noting US households held $56.4 trillion in stocks and mutual fund shares in the third quarter.

JPMorgan estimated a 10% S&P decline could reduce consumer spending by around 1%.

United States, Middle East

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