If you want to gauge the market impact of the latest turmoil in Iraq, just watch oil prices. This most political of global markets is trading near its highest prices in nine months because of new battles raging in the region.

Sunni rebels from the Islamic State in Iraq and Syria (ISIS) captured Mosul and Saddam Hussein’s hometown of Tikrit last week and on Monday they took over the small city of Tal Afar in northwestern Iraq, according to Iraq security officials. Shelling continues in the capital of Baghdad.

The situation is so serious that U.S. Secretary of State John Kerry Monday said the White House is "open to discussions" with Iran and wouldn't rule out possible military cooperation with the Shiite-led country.

Assuming the fighting continues, how high can oil prices go?

Related: Oil’s rise not just about Iraq turmoil: Dicker sees $130 by 2015

John Browne, the former CEO of BP, a leading global oil producer, says it's "impossible to say" but adds, "this is not a moment to panic." He tells The Daily Ticker, "We're not going to run out of oil but sentiment is concerned about the risk."

So far oil production in Iraq has not been affected, says Browne, who adds that "plenty of people are heavily engaged in making sure" that continues.

Iraq is the second largest oil producer in OPEC after Saudi Arabia, producing over 3 million barrels a day. Its production has helped to stabilize the oil market, which is already subject to declining production in Libya and Nigeria.

Related: Lifting the ban on oil exports could create more than a million jobs: study

But if Iraqi production is disrupted, Browne is not very concerned. He says Saudi Arabia and others could "certainly make up for" the decline, and the U.S. has "plenty of domestic supply and other sources coming in."

U.S. production "has changed the game," says Browne. The U.S. is now the world’s largest producer of oil and gas combined, as a result of fracking, which yields both oil and gas. "Security of supply is always underpinned by having more and more diverse sources of supply," says Browne.

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