A possible ban of Russian crude by the US and European Union (EU) caused oil prices to soar to $139.13 per barrel at the start of trading on Monday.
The import ban by the US and EU has been proposed and is currently being discussed by US and European officials as part of the sanctions imposed on Russia following the invasion of Ukraine. This has led to a 10% increase in the global benchmark of brent crude early Monday from Friday’s $118.03 close.
“We are now in very active discussions with our European partners about banning the import of Russian oil to our countries, while of course at the same time maintaining a steady global supply of oil,” stated US Secretary of State, Antony Blinken.
Following the $20 increase from Friday, the price has already dropped to $130. Fears remain, however, of continued price escalation in household energy and petrol as the conflict between Russia and Ukraine continues.
Heightened tensions between Russia and western countries over the Ukraine crisis risks crude oil prices surpassing all-time highs of $147.50 – recorded in July 2008. Europe heavily relies on Russian crude oil imports whilst the US secures 8% of its total crude oil – approximately 20.4 million barrels in 2021 – from Russia. The US and EU join Canada, who banned imports in the beginning of March, and Japan, who is reportedly at an advanced stage in its decision to follow suit.