Oil prices surge following Biden's new Russia sanctions
Oil prices surged to nearly $81 on Monday amid concerns that US sanctions on Russian oil exports might interfere with supply chains. Read Full Article at RT.com.
TroibNews 
Oil prices experienced an upward trend for the third consecutive day on Monday, with Brent crude surpassing $81 per barrel, marking a four-month high. This rise is attributed to traders' concerns that new US sanctions targeting Russian oil exports could impact supply to key buyers, including China and India.
In morning trading on Monday, global benchmark Brent crude futures increased nearly 1.5% to $80.6 after it had broken the $80 mark on Friday for the first time since October. US West Texas Intermediate crude also rose by over 1.5%, reaching $77.7, a level not seen in four months. Data indicates that both benchmarks have gained more than 6% since January 8.
Last Friday, the US initiated a “sweeping” new round of sanctions against Russia, coordinated with the UK. These sanctions focus on two significant Russian petroleum producers, Gazprom Neft and Surgutneftegaz, along with related entities, and impose restrictions on 183 vessels engaged in transporting Russian crude oil.
These restrictions may considerably diminish Russian oil exports, compelling China, the world's largest oil importer, and India, the third-largest, to seek crude from alternative regions such as the Middle East, Africa, and the Americas, as noted by analysts. This transition is likely to elevate global prices and shipping costs.
Goldman Sachs announced on Monday that the latest sanctions strengthen its prediction that Brent prices could continue to rise, potentially exceeding the range of $70-85 per barrel in the near future, as reported by Reuters.
The investment bank highlighted that the vessels targeted by the sanctions accounted for 1.7 million barrels per day of oil in 2024, representing a quarter of Russia’s exports, predominantly crude oil.
RBC Capital Markets analysts pointed out the logistical hurdles to crude flows created by the sanctions, noting that many affected tankers have been utilized for transporting Russian oil to India and China since Russia redirected its crude supplies to Asia following a ban on seaborne oil by the West in 2022. Additionally, some vessels have reportedly been involved in shipping oil from Iran, another sanctioned nation.
Analysts from Onyx Capital Group cautioned that targeting a “very large number of tankers” could be especially “consequential” for India.
Russia has become a major crude oil supplier to India, with New Delhi consistently emphasizing Moscow’s crucial role in maintaining energy security and pledging to increase imports. Outgoing US President Joe Biden also acknowledged that the sanctions might impact American consumers, potentially resulting in higher domestic gas prices.
In response to the sanctions, Maria Zakharova, spokeswoman for the Russian Foreign Ministry, remarked on Friday that while “some people leave a mark on history,” Biden will only leave a “mess” behind when his presidency concludes later this month.
Frederick R Cook for TROIB News
In morning trading on Monday, global benchmark Brent crude futures increased nearly 1.5% to $80.6 after it had broken the $80 mark on Friday for the first time since October. US West Texas Intermediate crude also rose by over 1.5%, reaching $77.7, a level not seen in four months. Data indicates that both benchmarks have gained more than 6% since January 8.
Last Friday, the US initiated a “sweeping” new round of sanctions against Russia, coordinated with the UK. These sanctions focus on two significant Russian petroleum producers, Gazprom Neft and Surgutneftegaz, along with related entities, and impose restrictions on 183 vessels engaged in transporting Russian crude oil.
These restrictions may considerably diminish Russian oil exports, compelling China, the world's largest oil importer, and India, the third-largest, to seek crude from alternative regions such as the Middle East, Africa, and the Americas, as noted by analysts. This transition is likely to elevate global prices and shipping costs.
Goldman Sachs announced on Monday that the latest sanctions strengthen its prediction that Brent prices could continue to rise, potentially exceeding the range of $70-85 per barrel in the near future, as reported by Reuters.
The investment bank highlighted that the vessels targeted by the sanctions accounted for 1.7 million barrels per day of oil in 2024, representing a quarter of Russia’s exports, predominantly crude oil.
RBC Capital Markets analysts pointed out the logistical hurdles to crude flows created by the sanctions, noting that many affected tankers have been utilized for transporting Russian oil to India and China since Russia redirected its crude supplies to Asia following a ban on seaborne oil by the West in 2022. Additionally, some vessels have reportedly been involved in shipping oil from Iran, another sanctioned nation.
Analysts from Onyx Capital Group cautioned that targeting a “very large number of tankers” could be especially “consequential” for India.
Russia has become a major crude oil supplier to India, with New Delhi consistently emphasizing Moscow’s crucial role in maintaining energy security and pledging to increase imports. Outgoing US President Joe Biden also acknowledged that the sanctions might impact American consumers, potentially resulting in higher domestic gas prices.
In response to the sanctions, Maria Zakharova, spokeswoman for the Russian Foreign Ministry, remarked on Friday that while “some people leave a mark on history,” Biden will only leave a “mess” behind when his presidency concludes later this month.
Frederick R Cook for TROIB News
