Morgan Stanley Warns of Severe Economic Risks for Asia if Oil Hits $120 per Barrel

Deep News
7 hours ago

According to a research report from Morgan Stanley analysts, a rise in oil prices to $120 per barrel could pose a significant risk to economic growth in Asia. The analysts estimate that a sustained increase of $10 per barrel in oil prices could directly reduce Asia's GDP growth by 20–30 basis points. They noted that if oil prices reach $120 per barrel, the region's oil and gas burden would account for 6.3% of GDP. The analysts stated that if geopolitical conflicts persist and commodity prices remain elevated, the available policy buffer to mitigate the impact would be weakened. They added that central banks in the Philippines, Indonesia, India, and South Korea may be forced to raise interest rates starting from late in the third quarter or the fourth quarter if the conflict continues.

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