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JPMorgan sees ‘stratospheric’ $380 oil on worst-case Russian cut-FORECAST

04 July 2022 16:03 (UTC +04:00)

JPMorgan Chase & Co. analysts warned that the price of oil may rise to a "stratospheric" $380 per barrel if US and European sanctions lead Russia to reduce its oil supply in retaliation, APA-Economics reports.

In an effort to put more pressure on Vladimir Putin's war machine in Ukraine, the Group of Seven countries is negotiating a complex mechanism to control the price at which Russian oil can be sold.

However, JPMorgan analysts, including Natasha Kaneva, stated in a note to clients that Moscow can afford to reduce daily crude production by 5 million barrels without significantly harming the economy given the country's strong budgetary situation.

However, the outcomes might be terrible for a large portion of the remainder of the world. According to the analysts, a daily supply reduction of 3 million barrels would cause benchmark London crude prices to rise to $190, while a reduction of 5 million barrels would result in "stratospheric" prices of $380 a barrel.