Oil prices could top $400 a barrel if Japan's crude price cap idea is adopted, says former Russian president

• Oil could exceed $300 to $400 a barrel if Japan's idea for a price cap on Russian crude is implemented, said a former Russian president.
• "There will be significantly less oil on the market, and its price will be much higher," Dmitry Medvedev said.

Japan recently proposed a price cap on Russian oil, but former Russian President Dmitry Medvedev said Tuesday it could send prices above $300 to $400 a barrel.

Under the plan, Russian oil would be capped at around half the current price, but Japan would "have neither oil nor gas from Russia, as well as no participation in the Sakhalin-2 LNG project," said Medvedev, who also previously served as Russia's prime minister and is now the deputy chairman of Russia's Security Council.

"There will be significantly less oil on the market, and its price will be much higher," he wrote on social media, according to Reuters. "Moreover, higher than the predicted astronomical price of $300 - $400 per barrel."

The warning comes after President Vladimir Putin last week ordered full control of the Sakhalin-2 gas project in Russia, which could end up pushing out energy giant Shell as well as Japanese giants Mitsui and Mitsubishi.

Meanwhile, at the end of June, G7 leaders discussed a Russian oil price cap to squeeze Moscow's finances and ability to fund its war in Ukraine. The talks included other nations, too, like India and South Africa.

"We want to make sure the goal is to target Russia and not to make our life more difficult and more complex," European Council President Charles Michel said, according to the Financial Times.

On Tuesday, oil dipped below $100 a barrel as growing fears of a recession caught up to the market. Top analysts, however, are saying that the sell-off may have been overdone, and that prices will remain hot as production drops off in Russia.

"While the odds of a recession are indeed rising, it is premature for the oil market to be succumbing to such concerns," Goldman Sachs analysts wrote in a Tuesday note.