By Marianna Parraga

HOUSTON (Reuters] -OPEC does not have control over events leading to an increase in oil prices. There is no global supply to offset the Russian loss, Mohammad Barkindo, Secretary General of OPEC said Monday.

As the United States, Europe and their allies consider banning Russian oil imports after Russia invaded Ukraine, Benchmark prices rose to an unprecedented $139 per barrel. [O/R]

Russia is the largest exporter of oil and crude fuel in the world, with 7 million barrels per day or 7% of all global supply.

Barkindo stated that there is not enough capacity to replace 7 million barrels of oil per day in the entire world, speaking at a Houston industry conference.

He said, “We don’t have control over geopolitics and current events. This is dictating market pace.”

U.S. and European governments have exempted energy trade sanctions from preventing tighter markets from rallying further. However, this exemption has been unsuccessful.

Russian oil has been avoided by traders to prevent them from being subject to future sanctions.

Analysts believe prices will soar if there is an absolute ban. JPMorgan (NYSE) predicts Brent will reach $185 in the next year. Prices would have to go up enough to satisfy demand if there is a shortage.

Barkindo stated, “I heard several speakers at CERAweek say that the current market conditions are tightening might cause some destruction of demand.”

“Even though that may be true, supply is becoming more behind the curve.”

Barkindo, an OPEC member and one of its allies, explained that the Organization of the Petroleum Exporting Countries did not end any production restraints at their last meeting. He also said that the market for oil had changed since the March 2nd group meeting.

He stated, “Let’s wait and see what happens at next meeting,”

OPEC+ and its allies, led by Russia, stated after the meeting that they believed markets were balanced. OPEC+ sources confirmed that on Monday.

Barkindo stated that OPEC+ was committed to maintaining market stability. Barkindo stated that the group continues to reverse the drastic cuts made during the worst of the pandemic. He stated that production should have been fully restored after September’s cuts.

OPEC+ remained faithful to its March 2nd meeting plans for a slight increase in output and was unaffected by the Ukraine crisis.

Barkindo said that market conditions were likely to play a major role in energy transition.

According to him, accessing capital to the oil industry is more difficult, however, the crisis shows that the world cannot afford to not continue investing in oil.

According to International Energy Agency, most OPEC+ member countries have very little oil production capacity. The bulk of extra capacity is located in the Gulf States of Saudi Arabia, UAE and United Arab Emirates.