Business

Crude oil rises to 7% US ban on Russian imports, but sells session highs

Oil prices rose to a session high on Tuesday, when President Joe Biden announced a ban on imports of Russian fossils, including oil, in response to the country’s invasion of Ukraine.

WTI crude oil rose to 7% to sell for more than $ 128 a barrel. The day ended 3.6% higher at $ 123.70. Brent crude oil, an international benchmark, rose 7.7% to $ 132.75 before selling high. At the end of the session, the contract was up 4.3% to $ 123.21.

“We made this decision in consultation with our allies and partners around the world, especially in Europe,” Biden said at a news conference. “We are working closely with Europe and our partners to develop a long-term strategy to reduce dependence on Russia.”

A man was pumping gasoline into his vehicle at a gas station in Montebello, California on February 23, 2022, losing gas prices by more than $ 6 per liter.

Frederic J. Brown | AFP | Getty Images

In 2021, the U.S. imported about 672,000 barrels of oil and refined products from Russia a day, or about 8% of all imports, according to Andrew Lipow, president of the Lipow Oil Associates, based on data from the Energy Information Administration.

Earlier, the United Kingdom announced restrictions on the purchase of Russian oil imports before Biden spoke, saying it would phase out imports from the country by the end of the year. The European Union also unveiled a plan to eradicate fossil fuels from Russia.

John Kilduff, the founding partner of Again Capital, said the oil took a second round of $ 130 and went bankrupt, which led to some sales.

“Everyone was wondering when Biden would announce the sanctions: buy the rumor, it would be time to sell the news,” Kilduff said. “Biden’s announcement strengthened the moment of the sale. Now we know where we are.”

The market has already self-sanctioned Russia’s energy complex, with buyers shunning the nation’s oil.

“Studies are changing, but it is probably fair to say that if Russia were to impose an import ban, the additional volume that would not be available would be quite limited,” Tamas Varga told PVM.

“The de facto ban on importing Russian crude oil is here with or without government legislation,” Lipow added.

Prices pump up

Americans are paying the most for the pump currently on record, as energy prices rise, contributing to the staggering inflation that is hitting all areas of the economy.

The national average of a liter of ordinary gas rose $ 4.173 on Tuesday, according to the AAA.

The previous record was $ 4,114 as of July 2008, not adjusted for inflation.

New high prices on Tuesday have risen since Russia invaded Ukraine after a sharp rise in gas prices.

Consumers are paying 55 cents more than a week ago, and about 72 cents more than last year.

Experts expect oil prices – and therefore pump prices – to remain high.

“Unless something serious happens, the average pump prices range from 4.50 to 4.75 liters for more than 5 gallons for motor fuels and diesel,” said Tom Kloza, head of global energy analysis at Oil Price Information Services.

Oil prices, meanwhile, rose to prices last seen in 2008 on Sunday.

West Texas Intermediate crude futures, a U.S. oil benchmark, sold for $ 132.07. Brent’s gross international benchmark hit $ 139.13. But both were positioned below those heights in Monday’s trading session.

Russia is a major producer and exporter of oil and gas, and the country is disrupting the global market with wars against Ukraine.

“Given Russia’s key role in global energy supply, the global economy will be able to cope with one of the biggest power outages ever,” Goldman Sachs said in a statement to customers on Monday.

– CNTI’s Patti Domm and Yun Li contributed to the report.

Crude oil rises to 7% US ban on Russian imports, but sells session highs

Source link Crude oil rises to 7% US ban on Russian imports, but sells session highs

Back to top button