The Digester
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Iran war raises U.S. recession risk, economists say

Economists say the Iran conflict has raised the chance of a U.S. recession by lifting energy and food costs and tightening financial conditions, though some analysts expect only limited economic fallout.

Mar 27th 2026 · United States

Insights

  • Goldman Sachs now assigns a 30% chance of recession and EY-Parthenon puts the odds at 40% after the Feb. 28 attacks on Iran.
  • Goldman projects higher energy prices will add about 0.2 percentage point to U.S. inflation, taking it to roughly 3.1% by year end.
  • Roughly 20% of global crude and natural gas normally transits the Strait of Hormuz, which is largely closed and is tightening supply.
  • U.S. pump prices climbed to about $3.98 per gallon for gasoline and $5.37 for diesel, up roughly $1 and $1.62 from a month ago.
  • Oil is up roughly 40% since Feb. 28 with Brent near $102 and U.S. crude near $94, and analysts warn sustained high energy costs and uncertainty could curb spending and investment and raise recession odds further while some forecasters still expect limited impact.

Sources