Moody's Chief Economist Mark Zandi believes the threat of the United States entering a recession is intensifying, primarily due to the convergence of two key economic factors. Since the outbreak of conflict involving Iran, oil prices have risen sharply. Zandi stated that weakness in the US labor market is a negative factor, and the recent volatility in energy markets could exacerbate the situation. "A recession is once again a serious threat," he wrote this week on platform X. "Even before the recent disturbing events in the Middle East, our machine-learning-based leading economic indicator model was predicting a troubling 49% probability of a recession within the next 12 months." The economist added that the recent spike in recession probability is mainly due to labor market conditions. Following the January jobs report, Zandi noted that while the data exceeded expectations, such strength is unlikely to be sustained. His recent comments also make it clear that he views oil price volatility as a potential accelerator of a downturn. "Given the conflict involving Iran and the resulting spike in oil prices, it's not impossible for this indicator to break through the key 50% threshold," he said. "Oil prices are a significant variable in the model for an obvious reason: since World War II, every recession, except for the pandemic-induced one, has been preceded by a spike in oil prices." Zandi added that the US can withstand high oil prices better than most because its oil production is roughly in balance with its consumption. However, he stressed that consumers will still feel the impact of expensive fuel. Indeed, gasoline prices across the US are surging, with the national average reaching $3.63 per gallon on Friday, compared to $2.91 just a month ago. He wrote, "If oil prices persist at high levels for a longer duration (weeks rather than months), a recession will become difficult to avoid."