MOSCOW (Bloomberg) -- Russia warned that crude oil prices may plunge further if the shock of Britain’s vote to exit the European Union is combined with a boost in output.

 

Returning production in Canada and Nigeria, which has been disrupted by wildfires and rebel attacks, combined with the Brexit result could mean “the drop in prices in the short-term may be serious,” Russian Energy Minister Alexander Novak said in an emailed statement. If supply isn’t restored, a return to fundamentals is likely fairly quickly, he said. 

 

Global benchmark Brent crude, which has recovered more than 70% since hitting a 12-year low in January, plunged as much as 6.6% after the result was announced early Friday. Shares in Russia’s largest oil producers Rosneft PJSC and Lukoil PJSC also tumbled.

 

Concerns over a possible “domino effect” inside the European Union are exacerbating volatility in commodities and financial markets, Novak said.

 

“If EU members begin to quit the union then this may have a significant consequences for the rate of economic growth and as a result affect the price of oil,” Novak wrote. “Then the consequences will be very hard to predict.”