Amid ongoing geopolitical tensions and skyrocketing energy rates, global oil prices may hit $380 a barrel if the US and European curbs compel Russia to inflict retaliatory crude output cuts, Bloomberg reported, citing analysts at JPMorgan Chase & Co.

 

It was after Russia’s invasion of Ukraine that the Western allies led by the US imposed several sanctions, and worked out a complicated mechanism to cap the price fetched by Russian oil.

 

According to JPMorgan analysts including Natasha Kaneva, currently Russia enjoys a strong financial position and it can afford to slash daily crude production by five million barrels.

 

The analysts noted that Russia’s crude production cuts could be disastrous for the world, as a cut of 3m barrels will elevate London crude prices to $190. In the worst-case scenario, if the output is cut by 5m barrels, the price could reach as high as $380 a barrel.

 

“The most obvious and likely risk with a price cap is that Russia might choose to retaliate by reducing exports as a way to inflict pain on the West,” wrote the analysts.