The co-director of the Institute for the Analysis of Global Security said that attempts by Western governments to impose a price cap on Russian oil are ridiculous.
US Treasury Secretary Janet Yellen said last week that a cap is the most potent way to control high oil prices, after the US and allies floated capping the price paid for Russian oil to as little as $40 a barrel. A number of energy market experts have doubts about the proposal.
In an interview with CNBC, Luft said that oil is a commodity and that barrels of oil are interchangeable regardless of who buys it.
That isn't how oil prices work. This is a well-oiled machine. Prices can't be forced down. "All it's going to do is cause the Russians to limit their production, and that's all it's going to do." He said that Europeans and Americans would get $140 a barrel for their oil.
Although oil prices briefly dropped below $100 this month on recession fears, experts say the declines are likely to be short-lived as a European embargo on Russian energy supplies won't kick in until the end of the year.
President Biden left Saudi Arabia with no announcement of an oil production hike, leading the IEA to call on European nations to prepare for a crisis this winter.
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