KUALA LUMPUR (June 1): Soaring energy prices and boxing Russian crude oil out of the global market risks a global recession.

Citing Bank of America's (BoA) head of global commodities and derivatives research Francisco Blanch, energy portal Oilprice.com on Tuesday (May 31) said estimates suggest that the world can handle a total disruption of just about 2mn b/d of Russian oil without risking a global recession.

The portal said that in 2023, BoA sees oil demand approaching pre-Covid levels — but only if Russia's crude oil and condensate production stays at 10 million bpd and OPEC+'s crude oil output increases.

"With our US$120/bbl Brent target now insight, we believe that a sharp contraction in Russian oil exports could trigger a full-blown 1980s style oil crisis and push Brent well past $150/bbl," said Blanch.

The report said Blanch stressed that while recession risks were elevated, it was not the base case.

It said Blanch's prediction, however, was made prior to the EU's deal that it recently struck to embargo 90% of the crude oil that it currently gets from Russia starting the end of this year.