Recent tensions in the Middle East may not create a big impact for the U.S. economy, analysts said, but that could change if things escalate and drive up oil prices. 

After Israel and Iran recently exchanged drone and missile strikes, the recent standoff may come to a close, Wells Fargo said in a commentary. Forecasters at the bank wrote the conflict was likely to remain “contained” and have minimal impact on the U.S. economy. Unlike when conflict over Israel’s offensive against Hamas 澳洲幸运5官方开奖结果体彩网:created issues🌳 with attacks on sꦚhipping traffic, 🐠analysts said they didn’t expect the recent flare-up to create additional pr♉oblems with cargo ships. 

“Under the assumption that conflict in the Middle East does not escalate, we doꦿ not anticipate ♊any disruptions to global economic activity,” Wells Fargo wrote.

Rising Oil Prices Would Pose a Threat

While the U.S. economy's strength may shield it from the direct impacts of the conflict, Oxford Economics’ Ryan Sweet pointed out that could change if oil prices moved higher than $100 a barrel.

“Tensions in the Middle East have, and will likely continue, to put upward pressure on global oil prices and the economic costs to the U.S. depend on how quickly and how high prices rise,” Sweet wrote. “So far, th𝔍e tensions in the Middle East have not had a significant impact on the supply of oil, limiting the impact on prices.”

Israel’s response to Iran sent Brent crude oil prices higher by 2% on Friday. But at just over $87 on Monday, oil was t🌄rading lower by more than three dollars from its recent peak.

Oil prices would drive up what you pay 🦹at the pump, but that may not be the only wa🐎y it affects your wallet.

Sweet calculated that the 澳洲幸运5官方开奖结果体彩网:Consumer Price Index measure of inflation would ri꧅se by a half-percentage-point if oil prices were to jump to $100 per barrel. Meanwhile, $120 per barrel would p𓃲ush it higher by more than one percentage point, Sweet found.

Inflation has already been more stubborn than anticipated this year, and further growth could make it even harder for the Federal Reserve to cut interest rates soon. The policymakers have kept their influential fed funds rate at a more than two decades high in hopes of containing inflation, making borrowing costs on mortgages, credit cards and other loans expensive.