On Thursday (today), oil prices surpassed $100 for the first time in more than seven years after Russian President Vladimir Putin announced his decision to attack Ukraine.
As fears of a full-fledged conflict in Eastern Europe grew, Brent jumped to $100 per barrel, while WTI reached $95.54 per barrel.
“I have decided on military action,” Putin said in Moscow just before the Brent surge, threatening anyone who intervened with punishment. He also urged Ukraine’s military to hand over its weapons.
His comments come after the Kremlin revealed that rebel commanders in eastern Ukraine had asked Moscow for military assistance in their fight against Kyiv.
Following Russia’s announcement of a “special military operation” in Ukraine, Brent climbed above $100/bbl. The oil market will be watching with bated breath to see what actions Western nations will take against Russia. Analysts believe that increasing uncertainty at a time when the oil market is already constrained makes the market vulnerable and that prices will remain unstable and high.
Brent crude hit $101.34 per barrel in early Asia trade, the highest since September 2014, and was at $101.20 per barrel at 0423 GMT, up to $5.97. As a result, US Western Texas Intermediate (WTI) crude futures rose by $5.64 to $97.74 per barrel after reaching a high of $96.51 earlier in the day.
Furthermore, natural gas prices increased by 4.7 percent, whereas spot gold, which is traditionally used as a hedge, decreased by 4.7 percent.
