'We simply don't know' - JP Morgan struggling to forecast oil prices due to Trump's war with Iran

Investment banking giant JP Morgan has said it is struggling to predict how oil prices will be impacted by the US-Iran war, telling investors in a rare note that "we simply don't know how to model the endgame".The bank said it assumed at the start of the conflict that there would be "economic red lines" that the Trump administration would be unwilling to cross, and therefore it believed a deal would have been struck to open up the Strait of Hormuz shipping lane back in June.It said such red lines included oil prices rising above $100 a barrel, inflation reaching 4%, gasoline topping $5 a gallon and rates on 10-year government borrowing hitting 5%."The market is on edge," analysts said.JP Morgan is a huge name in the financial world, so for the investment bank to admit its experts are grappling with working out the economic impact of the Iran-conflict" class="entity-link entity-event" data-entity-id="136843" data-entity-type="event">US-Iran conflict reflects the tricky nature of trying to predict President Donald Trump's next moves.An oil and gas industry source told the BBC it was "unusual" for such a high-profile investment firm to issue such a note, but added it was a "reflection on the state of play", given the uncertainties around the conflict. Investors often make investment decisions on inflation expectations and the price of oil is a major factor in prices rising across the world, given the commodity's widespread use and humanity's dependence on it.While gasoline remains below $5 and inflation has also not reached 4%, oil prices have surged back above $100 in recent weeks and the interest rate - known as a yield - on government bonds, which are issued in order for the US to borrow money from financial markets, has ticked over 5%.