NEW YORK (CNNMoney) — An oil price spike caused by a confrontation with Iran is now seen as the biggest threat to the U.S. economy.
That’s according to nine out of 18 economists surveyed recently by CNNMoney. They say rising oil prices now outweigh the risks posed by the European debt crisis, ongoing gridlock over the budget in Washington and fears of a slowdown in China.
"An Iranian disruption of oil supplies could send oil prices to $200 a barrel," said Lynn Reaser, chief economist at the Fermanian Business & Economic Institute.
"It’s something we’re really concerned about," said Chris Lafakis, an economist at Moody’s Analytics. "A military confrontation could push prices to $180 a barrel, which would precipitate a recession."
The economy, it appears, can handle oil around $100 a barrel and gas prices near $4 a gallon. While these prices are relatively high, consumer spending continues to rise.