Oil could jump to $185 a barrel if the EU agrees to an immediate ban of Russian crude exports, says JPMorgan
Oilprices could spike to $185 a barrel if EUabruptly banned Russian crude, JPMorgan said Tuesday.
- A full and immediate embargo would displace 4 million barrels per day of Russian oil.
Oil prices could soar if the
A full and immediate embargo would displace 4 million barrels per day of Russian oil, sending Brent crude to $185 a barrel as such a ban would leave "neither room nor time to re-route [supplies] to China, India, or other potential substitute buyers," the investment bank said in a note. That would mark a 63% surge from Brent's close of $113.16 on Monday.
The EU is weighing a ban as a consequence of
"In a slower phase-out," the bank said, "Russia would have more time to adjust its oil flows toward friendlier buyers and global ex-OPEC+ supply growth would have time to grow sufficiently to fill at least some of the Russia-sized hole in global oil supply."
India has increased its imports of Russian oil to three times the levels logged in 2021. But "its ability to continue to act as a sink for displaced Russian oil supply remains in question as the US warns India not to increase imports further," said JPMorgan.
Even without an EU oil ban, Russian exports are suffering as energy traders have avoided handling contracts for Russian crude in a trend of "self-sanctioning."
Seaborne shipments dropped 25% week-over-week, Bloomberg data showed Tuesday. As a result, Russian oil revenue in the week leading up to April 15 fell to $181 million from $240 million in the week prior.
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