Analysts have warned that oil prices could rise to ‘stratospheric’ levels in response to sanctions imposed by Western countries.
The authors of a new report by JP Morgan Chase predict that global oil prices could hit an eye-wateringly high of $380 (£313) a barrel if Russia responds to sanctions with reductions in crude oil output.
Last week, it was reported that G7 leaders will start exploring the options around imposing possible price caps on Russian oil and gas imports.
This measure could also reportedly force Gazprom to change the terms of existing contracts.
The analysts argued that the “most obvious” and likely risk with the price cap is that Russia might choose not to participate and instead retaliate by reducing exports.
JP Morgan warned a three million barrel cut to daily supplies would push London’s crude oil prices to around $190 (£156) a barrel.
A reduction of five million barrels a day would translate to a price of £380 a barrel, according to Bloomberg.