JPMorgan predicts $380 oil on worst-case Russian output cuts

In English, that's $22 a gallon for gas ..... California has high gas taxes, for Californians make that $24.50 a gallon for gas.

In other news, Biden signed an executive order banning lynching of government officials ….. no mention made of guillotines in that executive order.

JPMorgan predicts $380 oil on worst-case Russian output cuts

Bloomberg - 10h ago

© Sergei KarpukhinAn employee of Russian energy company Sakhalin Energy at a gas plant in Prigorodnoye, Russia. Reuters

Global oil prices could reach a “stratospheric” $380 a barrel if US and European penalties prompt Russia to inflict retaliatory crude output cuts, JPMorgan Chase analysts warned.

The Group of Seven leading industrial nations are working out a complicated mechanism to cap the price fetched by Russian oil in an attempt to tighten the screws on President Vladimir Putin amid Russia's invasion of Ukraine.

But Moscow can afford to reduce daily crude production by 5 million barrels without excessively damaging the Russian economy, JPMorgan analysts including Natasha Kaneva wrote in a note to clients.

For much of the rest of the world, however, the results could be disastrous.

A 3 million barrel cut to daily supplies would push benchmark London crude prices that are now around $111 to $190, while the worst-case scenario of 5 million could mean “stratospheric” $380 crude, the analysts wrote.

“The most obvious and likely risk with a price cap is that Russia might choose not to participate and instead retaliate by reducing exports,” the analysts wrote.

“It is likely that the government could retaliate by cutting output as a way to inflict pain on the West. The tightness of the global oil market is on Russia’s side.”

https://www.msn.com/en-ae/money/news/jpmorgan-predicts-dollar380-oil-on-worst-case-russian-retaliatory-output-cuts/ar-AAZ6ug9