Russia warns West of $300 per barrel oil

Western countries on Monday warned that a ban on Russian oil imports could result in oil prices to increase over $300 per barrel and prompt the closure of the main Russia-Germany gas pipeline.

In a statement on state television on Monday, Russian Deputy Prime Minister Alexander Novak said a “rejection of Russian oil would lead to catastrophic consequences for the global market.”

“The surge in prices would be unpredictable,” he said. “It would be $300 per barrel if not more.”

The warning came as the White House said US President Joe Biden was exploring a potential Russian oil ban with European allies as a way of punishing Russia for its invasion of Ukraine.

But Germany and the Netherlands rejected the plan on Monday, reports the BBC.

The EU gets about 40% of its gas. Russia is also the world’s top exporter of crude and oil products combined, with around 7 million barrels per day or about 7 percent of global supply.

Reports on Tuesday say the price of Brent crude – the global benchmark for oil prices – rose to around $130 a barrel. They also it may continue to increase.

“We are concerned by the discussion and statements we are seeing regarding a possible embargo on Russian oil and petrochemicals, on phasing them out,” said Russian deputy prime minister Novak.

He said if Europe were to ban Russian oil and gas, it would take countries on the continent more than a year to replace the volume of oil it receives from Russia and they would have to pay significantly higher prices.

“European politicians need to honestly warn their citizens and consumers what to expect,” Novak said.

“If you want to reject energy supplies from Russia, go ahead. We are ready for it. We know where we could redirect the volumes to.”

Ukraine has implored the West to adopt an oil and gas ban, but there are concerns it would send prices soaring.

Investor fears of an embargo drove Brent crude oil to $139 a barrel at one point on Monday – its highest level for almost 14 years.

German Chancellor Olaf Scholz earlier on Monday cautioned against a ban on Russian oil and gas, saying Russian energy imports were “essential” to Europeans’ daily lives, reports Al Jazeera.

– News Agencies