Brent prices could soar to a “ stratospheric ” $380 a barrel in “ the most extreme script ” of Russia slashing oil painting product by 5 million barrels per day( bpd) in retribution to a price cap being considered by the Group of Seven, judges at JP Mogan said in a note dated July 1.
G7 profitable powers agreed last week to explore assessing a ban on transporting Russian oil painting that has been vended above a certain price, aiming to limit Moscow’s capability to fund its irruption of Ukraine, which Moscow describes as a “ special operation ”.
“ A $50- 60 per barrel price cap would probably serve the G7 pretensions of reducing oil painting earnings for Russia while assuring barrels continue to flow, ” the bank said.
“ The most egregious and likely threat ” is Russia not cooperating and revenging by reducing exports of oil painting, it said, adding that Moscow can cut affair by over to 5 million bpd “ without exorbitantly hurting its profitable interest ”.
“ Given the high position of stress in the oil painting request, a cut of 3.0 million bpd could beget global Brent price to jump to $190/ bbl, while the worst- case script, a 5 million bpd cut could drive oil painting price to a stratospheric $380/ bbl, ” JP Mogan said.
Russian Deputy Prime Minister Alexander Novak said last week that attempts to limit the price of Russian oil painting could lead to imbalance in the request and drive prices higher.
JP Morgan also saw alterative scripts where China and India don’t cooperate with G7 on the price cap, or where Russia completely re-routes exports from the west to the east but loses pricing power.
