Iran’s blockade of the Strait of Hormuz, a vital maritime route for 20% of the world’s oil supply, has caused the largest-ever energy supply disruption – sending Brent crude to $105 a barrel and West Texas Intermediate up to $96 as of Thursday.

As long as the supply shock is temporary, it likely won’t hurt growth or unemployment – but it will probably boost inflation even higher, according to economists surveyed by the Wall Street Journal this week.

Crude oil prices would need to jump to roughly $138 a barrel to put the US at a serious risk of a recession, according to a new survey of economists. Guerin Charles/ABACA/Shutterstock

Economists see a 32% chance of a recession in the next 12 months – up from 27% in January, according to the survey, which collected answers from 50 economists at Wall Street banks, universities and consulting firms.

As for how high crude oil would need to climb to push odds of a recession above 50%, economists’ answers averaged around $138 a barrel – though their responses ranged from $90 to $200, per the survey.

Oil prices would need to remain at that elevated level for about 14 weeks to raise recession odds above 50%, according to the experts. That’s the average length of time they cited, with the economists giving a wide range of answers — from four to 55 weeks.

Uncertainty about how long the Middle East conflict could last has muddled such projections, with critics saying the Trump administration has given mixed messages on the timeline — prompting pushback from the White House.

Robert Fry, chief economist at Robert Fry Economics, currently sees a 40% chance of a recession, with oil at $125 for eight weeks as the tipping point.

“My forecast is contingent on the assumption that the Strait of Hormuz will be fully open to tanker traffic by mid-April,” he told the Journal. 

“If it isn’t, oil prices will go much higher, and I will put a recession in my forecast.”

Brent crude soared to $105 a barrel and West Texas Intermediate is up to $96 as of Thursday. Christopher Sadowski for NY Post

Economists forecast gross domestic product adjusted for inflation will grow 2.1% in the fourth quarter and the unemployment rate will hit 4.5% in December – roughly the same as their estimates earlier this year.

But their outlook on inflation has soured as they expect the Consumer Price Index to hit 2.9% in December – after earlier this year forecasting a more modest 2.6%.

National average gasoline prices have skyrocketed to $3.88 a gallon amid the Strait of Hormuz crisis, according to AAA, almost certainly playing a role in inflation this year – but economists said they expect price pressures to be broader than just higher prices at the pump.

They expect the core reading of the personal consumption expenditures price index, which is the Fed’s preferred inflation figure and excludes volatile food and energy prices, to rise 2.8% in the fourth quarter compared to the previous year. That’s a jump from forecasts of 2.6% earlier this year.

Economists expect price pressures to be broader than just higher prices at gas pumps. AFP via Getty Images

Economists said they expect oil to settle at $86.70 a barrel by the end of June, and finish the year at roughly $73.54.

The Federal Reserve on Wednesday held interest rates steady in the 3.5% to 3.75% range, opting to stay in wait-and-see mode amid the war in Iran and conflicting economic signals.

Most policymakers kept their predictions for the year the same, with the closely-watched “dot plot” showing one rate cut this year and another in 2027.

Like the economists in the survey, the Fed’s forecasts for GDP and unemployment were also little changed, and they now expect higher inflation.

National average gasoline prices have skyrocketed to $3.88 a gallon amid the Strait of Hormuz crisis. MediaPunch / BACKGRID

Fed Chairman Jerome Powell – whose term ends in May – nodded to heightened uncertainty around the war in Iran, joking that if there was ever a meeting to skip economic projections, “this would be a good one, because we just don’t know.”

But he also nodded to the economy’s relative steadfastness in the face of severe shocks, saying it has done “pretty well through a lot of significant challenges” – adding that slow job growth is partially due to an immigration crackdown, while tariffs and the pandemic have hit inflation.

Economists in the Journal’s survey also acknowledged the economy’s ability to withstand recent shocks – but noted that there is no guarantee this resilience will continue.

“Given the ongoing war in the Middle East, surging oil prices, high tariffs, AI and the severe constraints on immigration, it is worthwhile noting how resilient the US economy has been so far,” Bernard Baumohl, chief global economist at the Economic Outlook Group, told the Journal. 

“But we must not take this resilience for granted.”

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Chancellor Rachael Reeves has been steadily increasing pressure on gambling operators, with reports from the Office for Budget Responsibility suggesting the new measures could raise around £4 billion ($5 billion) in revenue.

What gambling measures are being proposed in the Autumn Budget 2025?

UK gambling companies are bracing for a major shake-up. Reeves has hinted that General Betting Duty on sports betting, online or in betting shops, excluding horse racing, would rise from 15% to as high as 30%, while online slot taxes might climb from 20% to 50%. She says the goal is to ensure that gambling firms “pay their fair share.”

‘I do think there’s a case for gambling firms to pay more,’ said the chancellor when asked if she would consider increasing the taxes gambling firms pay

‘They should pay their fair share of taxes, and we’ll make sure that that happens’ pic.twitter.com/iNPyki9EVN

— ITVPolitics (@ITVNewsPolitics) September 29, 2025

What has led to this potential increase?

The 2024 Budget, submitted by Reeves, the first from her party in over fifteen years, avoided hitting gambling firms in their pocket. Instead, it laid the path for reform, with lobbyists attempting to dissuade members of the UK parliament who were spearheading these proposed changes.

In the lead-up to the 2024 budget, UK gambling companies saw their shares take a hit, cutting more than £2 billion from the value of some of the biggest names in the industry. Entain, which owns Ladbrokes, dropped 7%; Evoke, the parent company of 888, slid 12%; and Flutter, which owns Paddy Power, was down 5.7%. These market reactions highlighted investor anxiety ahead of the last year’s budget. Even so, leaders from the major betting brands have been speaking out more openly as the 2025 budget approaches.

A proposed tax increase could hit bookmakers hard, raising their rate from 15% to 21% to match what online casinos and gaming sites pay. Industry insiders warn the move could be devastating for sports like horse racing.

The Betting & Gaming Council (BGC) published a statement to the Treasury, saying “Ministers have been clear in public and in parliament that they would be meeting with the relevant stakeholders as part of the consultation on tax harmonisation proposals. That includes the BGC, which represents companies employing over 100,000 people and a sector enjoyed safely by millions of customers each month.”

A key influence in the current debate is a report by the Institute for Public Policy Research (IPPR), which linked gambling-related harm to higher child poverty rates.

Gordon Brown, who held the position of Chancellor of the Exchequer, is a leading figure with the IPPR, and he has suggested the £4 billion ($5 billion) void could be filled by the gambling reform and tax increases.

Speaking to the Guardian in August, he said: “Time to tax the highly profitable gambling industry to pay for action on child poverty. Gambling will not build a Britain for the future, but children free of poverty will.”

Time to tax the highly profitable gambling industry to pay for action on child poverty.

Gambling will not build a Britain for the future but children free of poverty will. https://t.co/Foqzx47yza

— Gordon Brown (@GordonBrown) August 6, 2025

In the wake of Brown and the IPPR’s analysis and comment, 101 Labour MPs signed a letter to reform gambling, with taxation increases the key desirable to reduce child poverty.

The ministers involved shone the light on the IPPR research saying that if gambling was reformed in the United Kingdom, 500,000 children would be “lifted out of poverty.”

Industry response from gambling operators over Autumn Budget 2025 proposals

BGC chief executive Grainne Hurst was less than complimentary of Brown’s decision to target gambling firms, seeing it as hypocritical as the former Chancellor had been integral to the reform process previously.

“Long since hailed as a masterstroke, his interventions raised more tax, secured more jobs, and created one of this country’s global business success stories,” said Hurst.

The British Horseracing Authority (BHA) has been active in addressing the issue of gambling reform in the United Kingdom at every party conference for the biggest parliamentary groups.

BHA Chief Executive Brant Dunshea warned that higher taxes could have a “catastrophic” impact on British racing and related jobs.

He said the sport is “already in a precarious financial position and research has shown that a tax rise on racing could be catastrophic,” for jobs related to the hospitality, racing and retail environment.

UK job losses could be a result of these tax increases

William Hill, owned by Evoke plc under 888 Holdings, was vocal about the possibility that reform and incoming taxation hikes could have on their physical retail locations.

The company’s share value has dropped by 30% across the financial year, and it publicly stated that a possible 200 locations would close, causing 1,500 job losses.

Betfred’s co-founder Fred Done called the proposed tax increases the greatest threat the gambling sector has seen in over half a decade.

He spoke of the perils that physical locations would face in a BBC interview, saying, “We would have to close it down. I’m talking job losses. We’re talking probably 7,500.”

‘In job losses we’re talking probably 7,500’

Fred Done, who set up Betfred in 1967 with his brother, has warned all the firm’s 1,287 shops could disappear from the high street if Chancellor Rachel Reeves hikes taxes on gambling firmshttps://t.co/tyGtQrRRbl pic.twitter.com/xGkg7ttLeu

— BBC Breakfast (@BBCBreakfast) October 19, 2025

As the Autumn Budget approaches on November 26, 2025, Labour faces a key test of its economic strategy. The planned gambling tax rises could redefine the line between public welfare and private enterprise and determine whether the party’s promise of “fair growth” can withstand fiscal reality.

Featured image: Canva

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Personal consumption expenditures inflation rose 2.7% in August over the past 12 months, heating up from 2.6% in July as expected, the Bureau of Economic Analysis said Friday. 

Core PCE – which excludes volatile food and energy prices – remained stuck at 2.9%, the same rate as the month before, according to the report.

Federal Reserve Chair Jerome Powell speaks during a press conference earlier this month. REUTERS

The fresh inflation data comes just a week after the Fed slashed interest rates by a quarter point to 4% to 4.25%, its first cut since December 2024. Markets have been betting on a consecutive quarter-point cut at the Fed’s October meeting.

“Although it is still firmly above the Federal Reserve’s 2% target, we believe the central bank remains on track to cut interest rates again at its next meeting in October, since it’s clear that inflation is stable enough to handle lower interest rates,” Clark Bellin, president and chief investment officer at Bellwether Wealth, said in a note Friday.

Consumer inflation also heated up in August to 2.9%, according to the Bureau of Labor Statistics’ Consumer Price Index.

It’s enough to show that prices are still a concern, even after Fed Chair Jerome Powell signaled the weakening labor market was top of mind for central bankers ahead of their rate-cut decision.

A strong bout of economic data this week also revealed a much stronger US economy than previously estimated – likely throwing a wrench in any plans to cut rates aggressively over the next few months.

Friday’s report showed that consumer spending remained upbeat in August, rising at a 0.6% pace – above its 0.5% pace in July. 

That figure came in stronger than expected as consumers continued spending big despite President Trump’s slew of tariffs.

Consumer inflation also heated up in August. AP

Personal income increased 0.4% for the month, slightly above expectations.

Gross domestic product, which measures spending on goods and services, expanded at a 3.8% annual pace in the second quarter, according to a final estimate from the Commerce Department on Thursday.

That marked the fastest pace in nearly two years, after an outsize upward adjustment from an initial 3% estimate and later revision to 3.3%.

It was driven by a boom in consumer spending, which increased 2.5% – far above the previous 1.6% estimate and the 0.6% rate in the first quarter.

But the GDP reading is backward-looking, and more recent economic data has been a mixed bag.

Retail sales jumped over the summer thanks to a surprisingly strong back-to-school season, but hiring slumped.

Core PCE – which excludes volatile food and energy prices – remained stuck at 2.9%. AP

Meanwhile, initial jobless claims plunged to 218,000 for the week ended Sept. 20 – down 14,000 from the previous figure and far below estimates of 235,000, the Labor Department said Thursday.

That eased some concerns around the labor market, especially around layoffs and firings, although payroll growth has slowed and job openings have dropped.

But the Fed attributed its September rate cut to growing employment risks, so the new data – which reveals a more resilient labor market – could topple that line of thinking.

During a speech on Tuesday, Powell noted the economy “is showing resilience in the midst of substantial changes in trade and immigration policies.”

But he left the possibility of further rate cuts on the table, adding that policy remains “modestly restrictive” on growth.

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Net income from continuing operations for the fourth quarter was $86 million, compared to $67 million in the prior year period, the company said. Revenues rose to $2.11 billion, compared to $2.09 billion in the prior year period, and topped estimates of $2.1 billion, according to data compiled by LSEG.

The New York-based media giant’s earnings were boosted by higher circulation and subscription revenues at its Dow Jones division, which includes The Wall Street Journal, Barron’s, MarketWatch and Investor’s Business Daily.

News Corp’s earnings were boosted by higher circulation and subscription revenues at its Dow Jones division, which includes The Wall Street Journal, Barron’s, MarketWatch and Investor’s Business Daily. REUTERS

For the 2025 fiscal year, which ended in July, profits skyrocketed 71%, to $648 million from $379 million the previous year. Revenues for the full year increased 2%, to $8.45 billion, compared to $8.25 billion in the prior year.  

“These robust results have enhanced our financial position and thus our ability to return capital to shareholders,” News Corp CEO Robert Thomson said.

News Corp’s board of directors last month authorized a new $1 billion stock repurchase program, in addition to the approximately $300 million remaining from the previous $1 billion program authorized four years ago. 

“We expect to begin executing repurchases at an accelerated rate shortly after the release of these results,” Thomson said. “This significantly larger total and significantly faster tempo emphasize our belief in the Company’s financial strength.”

The strong earnings report comes a day after The Post announced plans to expand to the West Coast with the launch of The California Post in early 2026.

The strong earnings report comes a day after The Post announced plans to expand to the West Coast with the launch of The California Post in early 2026.

Thomson made a pointed call for the industry to “cherish the value of intellectual property” amid the looming threat posed by artificial intelligence.

“Much is made of the competition with China, but America’s advantage is ingenuity and creativity, not bits and bytes, not watts but wit. To undermine that comparative advantage by stripping away IP rights is to vandalize our virtuosity.” he said. 

“Even the President of the United States is not immune to this blatant theft. The President’s books are still reporting healthy sales, but are being consumed by AI engines which profit from his thoughts by cannibalizing his concepts, thus undermining future sales of his books. Suddenly, ‘The Art of the Deal’ has become ‘The Art of the Steal.’”

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