Oil prices likely to hit $200 per barrel if G7 caps Russian crude oil, SEB Group.
According to SEB analyst, Bjarne Schieldrop, there are no uncertain terms that G7 price capping proposal was a disaster during this time period.
This Tuesday, G7 leaders have agreed to study price cap of Russian oil being sold in the international market, seeking support among the like-minded nations. This was the critical item to be discussed at the meeting as group tried to be creative with lowering down the energy prices so that adequate supplies can be maintained from Russia. In the same time punishing Russia that appears to be a quiet impossible task.
As EU continues to support the price cap, US Treasury secretary Janet Yellen continues to pressurize.
The plan appears neat on the paper, but this is a disasterous recipe, given the stronger demand for crude oil and low supplies as per schieldrop.
The analyst Argued that Russia chose not to sell it at the capped Price. And this can be a decision that leads to Russian production falling by around 2 million barrels per day.
In the month of June Russia’s crude oil production rose by 10.7 million bpd. This has not been added in the OPEC+ agreement. On the other hand, Russia’s oil exports have been slipped by 3.3%. According to the deputy prime minister, the production of oil will increase in July.