Oil could hit $200 a barrel, says Rystad Energy

© Reuters. FILE PHOTO: Oil barrels are pictured at the site of Canadian group Vermilion Energy in Parentis-en-Born, France, October 13, 2017. REUTERS/Regis Duvignau

OSLO (Reuters) -Global oil prices could rise to $200 a barrel if Europe and the United States ban imports of Russian oil, analysts at Oslo-based consultancy Rystad Energy said on Tuesday.

Oil prices jumped on Monday to their highest since 2008 on fears of a Western ban on Russian oil imports while a return of Iranian crude to the market remains far from certain.

The global Brent oil benchmark currently trades at $129 a barrel, up from about $97 before Russia’s invasion of Ukraine.

Oil prices could double from pre-conflict levels, but it wouldn’t be as bad as during the 1973 oil embargo, when oil prices tripled, said Jarand Rystad at the consultancy.

Rystad Energy analysts said the $200 estimate was based on an assumption that Western sanctions could remove about 4 million barrels per day (bpd) of Russian crude.

Russia, the world’s second-biggest oil exporter, ships about 7 million bpd of crude and oil products combined.

The United States is expected to announce a ban on Russian oil imports as soon as Tuesday, a source familiar with the matter told Reuters.

Last week Rystad had predicted that Brent crude would climb above $130 a barrel because Russian exports were to plunge by 1 million bpd as a consequence of previously announced sanctions and voluntary actions by companies.

Shell (LON:RDSa), among others, said on Tuesday that it would no longer buy Russian crude oil and would phase out its involvement in all Russian hydrocarbons.