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Here is what could send the price of oil to $380 / barrel – JP Morgan on Russia revenge


JP Morgan analysts outline potential retaliation by Russia if the G7 manage to put together a mechanism to cap the price of Russian oil:

  • “The most obvious and likely risk with a price cap is that Russia might
    choose not to participate and instead retaliate by reducing exports.”
  • “It is likely that the government could retaliate by
    cutting output as a way to inflict pain on the West. The tightness of
    the global oil market is on Russia’s side.”

Price impact:

  • A 3 million-barrel output cut to daily supplies would push benchmark London
    crude prices to $190
  • Worst-case scenario of 5 million could
    mean “stratospheric” $380 crude

Info comes via Bloomberg (gated)

In the wake of the SPR release, from the US and some Asian countries

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