Think $4 gas is bad? What if this turns out to be the good ol’ days?

With oil prices remaining stubbornly above the $100 per barrel mark for WTIC, calls for $6 gas in the U.S. as a consequence of an attack on Iran may turn out to be arather conservative, maybe even a low-ball estimate.

In late February, economist, author and money manager Stephen Leeb told King World News he expects a record gas price this summer. The author of Red Alert said the oil market has entered the perfect storm.

“March is now on the way, and we are seeing very high prices for gasoline at the pump,” Leeb told KWN in a Feb. 22 interview. “ . . . we are continuing to see higher prices for gasoline and it may even hit record highs. In fact, I think they will hit record highs and we will see a minimum of $6 per gallon gasoline in the United States this summer.”

But it could get even worse than that.

But a military conflict with Iran could throw Leeb’s $6 price target far off the mark, as approximately 17 percent of the world’s oil supply could be shut out for, not a matter of weeks as the Pentagon has estimated, but months, according to Caitlin Talmadge, fellow at the John M. Olin Institute for Strategic Studies at Harvard University.

CEO of Sprott Assett Management USA Rick Rule told KWN on Tuesday that he believes an attack on Iran could take oil to levels beyond $150 per barrel WTIC, much beyond. According to Rule, “there is virtually no limit to the upside for oil prices. The oil price could easily double.”

Moreover, oil trading above $200 per barrel could easily take gasoline to $8 in the U.S., as a panic to secure already-tight global supplies could shock the American people into another significant downturn in the U.S. economy, more Fed monetary stimulus in response to the crisis, as well as technical support at much higher oil prices, irrespective of the eventual opening of the Strait of Hormuz possibly months into the future.

At those levels for any amount of time, I don’t see how we avoid depression. Scary stuff.

ht Insty