- ICE Brent rises $1.11/b to $108.64/b
- India to continue buying Russian oil
After declining during the week ended April 1, oil prices are gaining again as markets wait on the outcome of the EU discussions on new Russian energy sanctions, says an article published in S&P Global.
Search for new suppliers
June ICE Brent crude futures were up $1.11/b on the day at $108.64/b at 11:35 am BST April 5, while April NYMEX WTI futures were up $1.20/b at $105.48/b.
The European Union is considering the prospect of new energy sanctions on Russia, including those on Russian oil imports and coal. With new calls emerging for oil embargoes on Russia, many countries are looking for new suppliers among oil-producing countries with Saudi Arabia having the largest capacity to increase outputs.
“If this [Russia oil self-sanctions] were to happen, demand would switch to an even greater extent to other sources of supply, which would result in considerable price rises,” Carsten Fritsch, commodity analyst at Commerzbank said in a statement.
General financial difficulties
In a show of support, European Foreign Policy Chief Josep Borrell and European Commission President Ursula von der Leyen plan to visit Kyiv this week, with the Ukrainian capital gradually becoming safer to travel to.
The US Treasury will “not permit any dollar debt payments to be made from Russian government accounts at US financial institutions,” its spokesperson said.
China and especially India continue to, or have even increased, import volumes of Russian oil. India has not placed any sanctions so it is purchasing discounted Russian oil and confirmed its intention to do so in the previous week. In addition to energy, India and Russia are partners in defence sectors too.
The World Bank revised April 5 the economic growth numbers for Asia in the remainder of 2022 amid rising poverty in the Asia Pacific. The main reasons for this were the slowdown in China, changing monetary policy in the US along with the Russia-Ukraine conflict, which may affect commodity supplies and lead to general financial difficulties amid high prices.
Fuel shortages
The UK may face petrol and diesel shortages as climate protesters continue to blockade oil facilities in England.
Operations at oil refineries near London and Birmingham were limited for the fifth day in a row as the government holds regular debates on what the approach should be on fossil fuel and renewable industries’ development in the UK in the immediate term.
The CBOE OVX index, an indicator of crude oil price volatility, was down on the day at 54.31%.
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Source: S&P Global
