According to a senior U.S. Treasury official, oil prices could jump to $140 per barrel if a price cap is not imposed on Russian crude oil. And for the price cap to be efficient, widespread buy-in would be needed, and Russia might retaliate by cutting off exports and creating a price spike.
Moreover, the global oil supply is expected to struggle to meet the rising demand for fuel, according to the International Energy Agency (IEA). “Low global oil inventories coupled with continued high demand for gasoline, diesel, and other petroleum products means that increased production likely won’t have much impact on prices in the short term,” said EIA Administrator Joe DeCarolis.
