Russia warns West of $300 per barrel if US, EU impose ban

By Team Newsable | First Published Mar 8, 2022, 1:07 PM IST

Russian Deputy Prime Minister Alexander Novak said on state television on Monday that it was "clearly apparent that a rejection of Russian oil would lead to disastrous consequences for the world economy." "The price increase would be unpredictability," he added. "It would be at least $300 per barrel."

A top Russian official has warned that a Western ban on Russian oil imports could cause oil prices to more than double to around $300 per barrel, forcing the closure of Russia's main gas pipeline to Germany. Russian Deputy Prime Minister Alexander Novak said on state television on Monday that it was "clearly apparent that a rejection of Russian oil would lead to disastrous consequences for the world economy." "The price increase would be unpredictability," he added. "It would be at least $300 per barrel."

The warning came as the US, attempting to increase pressure on Moscow for its invasion of Ukraine, said that Washington and its European allies were mulling a ban on Russian oil imports. According to the White House, US President Joe Biden discussed the subject with his counterparts in France, Germany, and the United Kingdom on Monday during a conference call. Biden is facing rising pressure from US legislators to cut Russia off from the money it receives from oil and natural gas exports. However, Biden has not made a choice "at this time," according to a spokesperson.

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Following its attack on Ukraine, Western nations have struck Moscow with a wall of sanctions, with Washington restricting technology shipments to Russian refineries and the Nord Stream 2 pipeline, which was supposed to transport gas from Russia to Germany. Berlin, largely reliant on Russian crude oil, has halted the pipeline's accreditation.

Earlier on Monday, German Chancellor Olaf Scholz warned against a boycott of Russian oil and gas, saying Russian energy imports were "vital" to Europeans' everyday lives. Russia provides 40% of Europe's gas. It is also the world's leading crude and oil product exporter, with over 7 million barrels per day, or around 7% of global output.

According to Novak, Russia's deputy prime minister, if Europe banned Russian oil and gas, it would take more than a year for nations on the continent to replace the volume of oil they receive from Russia, and they would have to pay much higher rates.

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