By : Dr. Franyi Sarmiento, Ph.D., Inspenet, March 8, 2022.
Oil prices showed wide fluctuations in the first operations this Tuesday, after having reached maximums in 14 years this Monday due to a possible discrepancy between the United States and the countries of the European Union (EU) on sanctions on oil imports. and natural gas from Russia.
International benchmark Brent crude traded at $127.40 a barrel at 06:11 GMT, up 3.4%, after closing the previous session at $123.21 a barrel.
The West Texas Intermediate (WTI), the US benchmark index, traded at USD 122.62 a barrel, 2.7% higher than the previous session’s close of USD 119.40 a barrel.
Prices continued to rise rapidly and Brent hit $130 a barrel on Monday, fueling ongoing concerns that its high price will, in turn, increase global inflation rates in several years, negatively affect the global economic outlook and the demand, especially in the civil aviation sector due to the expected decline in international travel.
Despite the efforts of the International Energy Agency (IEA) to bring to market more than 61 million barrels of crude from emergency reserves, the severity of the war between Russia and Ukraine and the countermeasures by the United States and the EU, including import sanctions on Russian oil, were enough to put pressure on world oil markets.
To these must be added the US measure to unilaterally ban the import of Russian oil.
The United States is the largest contributor to the IEA’s emergency stockpile plan, with 30 million barrels.
Meanwhile, Germany on Monday ruled out banning energy imports from Russia despite plans by the United States and several European allies to adopt tougher sanctions against Moscow to stop the war in Ukraine.
“There is currently no other way to ensure Europe’s energy supply for heating, mobility, electricity supply and industry,” recalled its chancellor, Olaf Scholz, in a statement.
Talks about the possibility of prices reaching $200 a barrel have already started, but Russian Deputy Prime Minister Alexander Novak warned that if all Russian oil exports are blocked on world markets, oil prices oil could even rise to more than USD 300.
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