JP Morgan urges caution over Russian oil

By Scoop
July 5, 2022 · less than 3 min read

Things might be bad now – they could get worse…

Stepping on broken glass

Russia holds one hell of an ace up its sleeve. Specifically, on the question of oil, it actually holds pretty much all the cards. Countries around the world are taking careful steps to slowly but surely reduce their reliance on Russian oil, but the analysts at JP Morgan have urged caution.

Should Russia decide to play hardball, global oil prices could reach as high as $380 a barrel. A rise that high would have a stratospheric impact on markets, and of course, consumers, and JP Morgan analysts have been quick to urge caution when it comes to approaching this issue.

Where do we go from here?

So, what does this mean when it comes to approaching markets? A lot of investors have already priced in a lot of supplier risk when it comes to crude prices, and we don’t yet know exactly how the oil consuming nations of the world will respond. For now, investors are probably best off sitting tight. Or, if risk appetite is a little more geared towards safety, maybe it’s time to move money elsewhere.

Navigating the difficulties of supporting the Ukrainian forces by weaning our energy supply away from Russian crude is no easy feat. At a time where interest rates are on the up – and seem set to go even further – it’s time to ask yourself whether you still feel comfortable in crude.

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